The Association of Chartered Certified Accounts (ACCA) has said that the European Union (EU) should transfer the 80% tax tariffs that it would receive from goods imported into Ireland from the UK if there is a no-deal Brexit scenario.
All goods entering the EU, under the World Trade Organisation's (WTO) rules sees the country of entry receiving 20% of the tariff, with the vast majority, 80%, going to the EU’s central revenues.
WTO tariffs, if implemented under a no deal Brexit are expected to raise the costs of many UK goods and services in Ireland by between 5% and 30% with consumers paying the additional cost and this could reduce GDP by as much as 1%.
ACCA has said the 80% of Irish duty on UK imports that would be retained by the EU under WTO rules, could be provided to Irish Revenue as part of a wider economic support package.
The professional body has said that this resource could be targeted at supporting Irish consumers, businesses and farmers who are most impacted by a no deal Brexit.
ACCA Chairperson Stephen O’Flaherty said: “Many people will be surprised that under international WTO rules, imports into the EU from any other international region sees only 20% being retained by the country of entry.
"While Ireland was a net benefactor of EU investment during the financial crisis over ten years ago, with Brexit it now finds itself in the eye of an international storm and the EU must maintain its flexible support.
"It can do this by ensuring that the revenue from UK WTO trade tariffs form an integral part of a far reaching economic support package that can help offset some of the financial upheaval of Brexit on businesses, communities and families throughout Ireland.
“In particular, this additional revenue could be redirected to support investment in sectors such as the agri-food industry which sees Ireland’s largest trading partnership (38%) with the UK, exporting €5.2bn of goods in 2017.”
In 2017, Irish imports from the UK cost £34bn (€39bn) and ACCA has estimated that under the existing WTO trade system, import duty could add as much as €3.4bn to this bill meaning that the EU would take the vast majority (€3bn) of this for its central budget.
Within car imports alone, this would equate to the EU taking €80m out of the Irish economy with increased costs of 10% being borne by Irish consumers, according to ACCA.