'No new customs posts' post-Brexit, says Irish tax chief

Customs hut used after partition in the 1920s at Tully between Pettigo and Belleek
Image caption An old customs hut dating back to the 1920s

The head of the Irish tax authorities is "practically 100% certain" there will be no new customs posts along the 320-mile land border between the UK and the Republic of Ireland post-Brexit.

"We will likely not have any additional customs posts," said Niall Cody.

Reports of evidence given to the committee by a colleague had created the impression such posts would return, he told parliament's Finance Committee.

Revenue Commissioners were engaged in contingency planning, he said.

But having considered the matter, Mr Cody said he was "practically 100% certain" there would be no new customs facilities along the 320-mile (500-km) border.

"We are not planning customs posts," he said.

The border separating Northern Ireland and the Irish Republic will become an EU-UK frontier after Britain pulls out of the EU.

Barnier warning

There have been warnings that a hardening of the border, which has become virtually invisible as a result of the Northern Ireland peace process, could threaten the current stability and prosperity on the island.

The UK and Irish governments have both said they do not want a return to customs posts on the border after the UK leaves the EU.

Image copyright PA
Image caption Finding a solution on the post-Brexit Irish border is high on the EU's priority list

Earlier this month, the EU's chief negotiator Michel Barnier said the Irish border issue would be one of his three priorities and that he would work to avoid a hard border.

But, while on a two-day visit to Ireland, he emphasised that there would have to be some form of customs controls as a result of Brexit.

Mr Cody rejected reports that his organisation was actively looking for locations to establish new checkpoints.

He said the speculation, which he blamed on an earlier contingency paper from a "medium-ranking" official, had led to landowners along the border directly offering him sites for sale.

Image copyright Reuters
Image caption The Brexit negotiations will firstly be 'human, social and economic', said the EU's Michel Barnier

While businesses must assume there would "some form of customs" post-Brexit, he said the Revenue was engaged in upgrading its IT infrastructure to allow people to make declarations online.

Mr Cody said ongoing analysis of cross-border trade increasingly shows that most goods transported between the jurisdictions will not need to be physically checked.

Much of it is agri-food and construction related, and can be documented online.

There are also existing Revenue offices in border counties where traders can carry out their necessary paperwork.

"I'm practically 100% certain we will not be providing new trade facilitation bays in whatever parts of Donegal, Monaghan or Cavan," he said.

Mr Cody also told the parliamentary committee that Revenue was not negotiating with HM Revenue and Customs on post-Brexit arrangements.

It was, though, assessing all the implications and options, while upgrading its IT systems and recruiting more staff, as it prepared for the outcome of the political negotiations, he said.

€100 per movement?

Earlier, the committee heard that cross-border trade could cost businesses around €400m (£346m) in compliance costs after Brexit.

That figure is separate to customs tariffs.

Carol Lynch, a partner with the accountancy firm BDO Ireland, told the committee that a charge of €100 per movement would likely apply.

She said there was likely to be a requirement to lodge customs declarations on all imports and exports in and out the UK once the UK leaves the customs union.

"There is a necessary cost for this, either in the payment of a clearance agent or the recruitment of staff in addition to logistics-related costs," she added.

This would be an administrative cost to be paid by the businesses, to an agent, in order to complete an import declaration.

Michael McGrath, the finance spokesman of the main opposition party, Fianna Fail, said this would place a significant annual cost on businesses.

He estimated that when applied to all cross-border movements, it would amount to around €400m each year.

There is much uncertainty surrounding Brexit and what it will mean for the relationship between Northern Ireland and the Republic.

The fog of that confusion will only lift once the UK general election is over and the two sides in the forthcoming negotiations can get down to real business.

More on this story