UK Entrepreneurs in a Post-Brexit World

The rest of the world will move on with or without us. The stupidity of Brexit gives them a laugh, just as we laughed at the Greeks a few years ago.

The World will change. What will those changes mean for UK entrepreneurs?

Tax Changes

VAT is dead, long live BAT.

We might be headed out of European VAT, but you can bet the life of your first-born that HM Government will replace VAT with a similar tax on purchases, perhaps British Added Tax (BAT).

We might be away from the bullies of Brussels so we can do what we like, but the UK Exchequer has come to rely on VAT receipts, so BAT will rise from the ashes of VAT.

There is one piece of good news. No more lunacy of paying VAT receipts to 28 EU governments through HMRC’s MOSS. This is a gem that Brexiteers have failed to capitalise on. If they had, every business owner and entrepreneur would have voted to Leave.

Tariffs

You can expect extra duties on everything you sell abroad. Whether you are selling digital information products or the latest in whoopee cushions, the EU will find a way to tax it.

Physical products will face delays at Channel ports that would have your speciality cheeses going from ripe to stinky before they are even on the ferry. Switching to digital or non-perishable products is the only answer. Perhaps a 3D printed Stilton would catch on in France or Germany.

Even if you are selling to Australia, Nigeria, and the USA, your customers will face customs charges on every parcel they receive. This is because World Trade Organisation (WTO) tariffs are higher than those we have benefitted from under the EU, because the European bloc of countries could drive trade deals that were extremely favourable. We aren’t going to have any trade deals in place, and when we have, they will be on worse terms than our current ones.

Currently, you pay a customs levy for parcels you receive that were posted outside the European Union. Post-Brexit, your EU customers would have to pay customs duties on anything you post from the UK. That will go down well, won’t it? Luckily there is a workaround: You can manufacture and post your products in the EU, perhaps in Belgium or Poland. However you would need a UK factory too, so your British customers wouldn’t face duties.

Travel

Travel is going to cost more. You will need to pay for a visa every time you need to visit a customer in Europe; airfares will rise, and using your phone will cost more.

Remember how extortionate roaming charges meant you couldn’t use your mobile abroad? Well, they are coming back. The EU fought all the mobile phone networks to abolish roaming charges. The operators took a profit hit and were less than happy. Our friendly British mobile operators are going to reinstate them on B-Day +1, so their balance statements make better reading to shareholders.

Internet

Post-Brexit, how are you going to sell outside these green and pleasant lands?

How do you get over the inevitable Anglophobia that will spread through mainland Europe like liquid faeces leaking out of a baby’s nappy? Are your Austrian customers going to buy from your co.uk website? Unlikely.

You will need multiple domains, including a .eu URL. Your co.uk domain will appeal to Britons, your .com site will sell worldwide, and your .eu website will be attractive to the Anglophobes in the European Union. These will all need to be active sites rather than all redirecting to one .co.uk URL, so you will have triple the work and triple the management costs.

The Solution

No more MOSS is the sole benefit of Brexit, and it hardly seems worth the multitude of downsides just to make your accountant’s job slightly simpler.

Buy the .eu and co.uk domains to match your .com website and get those sites live in the next few months.

Move to Ireland, the only other English speaking country in Europe. If you don’t want to go that far, then get dual citizenship in one of the remaining 27 EU countries, which will allow you to live and work anywhere in the EU.

Get a phone from a European network, or buy a dual-sim phone, which will mean your jacket pockets last longer.

 

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