Election result provides heightened certainty for businesses

Now that Boris Johnson has been returned to 10 Downing Street with an overall majority, businesses in Northern Ireland can finally start planning around Brexit
Peter Legge

THE surreal experience of a general election in early December has come to an end and the result of a large Conservative majority means we can now make forecasts for business with a considerably higher degree of certainty than ever before.

In case it wasn't already abundantly clear, Brexit is happening – and soon. Provided all runs smoothly for the Tories over the coming weeks, we will leave the EU on January 31 - now just over six weeks away.

We also know that the government is committed to ending the transition period on December 31 2020. At that point, the current indication is that there will be no customs union arrangements between Great Britain and the EU.

It will also trigger the Northern Irish Protocol that will apply until at least the end of 2026. This will provide a softer Brexit for goods (but not services), although this does not take into account trade between Northern Ireland and Great Britain, where increased customs checks are expected.

This heightened level of certainty provides a firm basis for implementing plans for Brexit, which should cover longer-term adaptation as well as compliance and business continuity actions.

Businesses should understand what your optimal operating model and market strategy after Brexit will be. For goods exporters, this should include putting in place, now, the customs processes needed for January 2021.

As government negotiations unfold, businesses should identify the opportunities around future trade policy, immigration and tax as well as plan to use them to drive change in your own organisation.

Worldwide developments will also play a part, as increasing numbers of analysts point towards a recession. Therefore, it is vital that businesses keep a check on your costs base, manage cash flow and continue to focus on how you offer value to your customers.

With Parliament returning this week, and expected to sit until December 23, the Tories appear set to come good on their election mantra of ‘getting Brexit done'.

Although the option remains (until July 1 2020) to extend the transition period by two years, we must work on the assumption that it won't be lengthened, as per the Tories' election pledge.

By focusing on what we know for certain and seeking professional guidance where necessary, businesses can build resilience and agility, such that you are prepared for Brexit in whatever form it takes.

:: Peter Legge is tax partner at Grant Thornton in Belfast

Enjoy reading the Irish News?

Subscribe now to get full access