Percy Pigs become latest Brexit victim as retailer M&S warns price may rise
Percy Pig sweets are not the only products which could be hit by the Brexit “rules of origin” regulations
Percy Pig sweets are not the only products which could be hit by the Brexit “rules of origin” regulations. Photograph: Patrick Humphreys
Percy Pigs have become a most unlikely and bizarre poster child for Brexit’s impact on Irish consumers with Marks & Spencer warning today that the price of its popular jellies could climb in Ireland because they are made in the EU rather than UK.
The Withdrawal Agreement reached between the UK and the EU on Christmas Eve gives British products tariff free access to the Single Market including the Republic but only if those products originate in the UK.
Because Percy Pigs are actually manufactured in Germany and then exported to the UK before being re-exported to the Republic they could now be hit with taxes and charges , the British retailer has warned.
Percy Pig is not, however the only product which could be hit by the new rules and as many as 2,000 products sold in M&S food halls could be caught by the “rules of origin” regulations set out in the withdrawal agreement.
Other retailers with operations in the two jurisdictions will be similarly affected.
When asked how Brexit is impacting his business the chief executive of M&S Steve Rowe referenced the popular jellies. “The best example I can give you of that is Percy Pig,” Mr Rowe said. “Percy Pig is actually manufactured in Germany. If it comes to the UK and we then send it to Ireland, in theory it would have some tax on it.”
He said that as many as a third of the products in its food business “are subject to complex rules of origin around componentry and how much has been altered in the UK. Depending on that, there is a variable rate of tariff on goods. Tariff-free does not feel like tariff-free when you read the fine print.”
He added that Marks & Spencer’s business in the UK would be spared tariffs as result of the deal but it would “significantly impact” the retailer’s 18 stores in the Republic.
A spokesman for Revenue told The Irish Times that “no tariffs will apply if goods entering the EU from the UK are proven to be of UK origin and a request for preferential treatment has been included on the customs declaration. Similarly no tariffs will apply if goods being exported to the UK from the EU are proven to be of EU origin.”
It has a week since the UK left the EU and one of the other ways Brexit will impact people here will be the addition of significant volumes of red tape and form filling, as well as higher charges, when sending and receiving parcels to and from Britain.
There is also likely to be a loss of rights when dealing with British companies - or at least a loss of legally enforceable at EU level rights,
Online shoppers will not face additional import charges when buying something for €22 or less – a price which must include shipping, delivery, insurance and handling charges. However once the value of the goods goes above that, then Irish VAT will be payable.
Consumers will also have to pay customs duty and VAT if the value of the goods is more than €150 (excluding shipping, delivery, insurance and handling charges) depending on where the products originate.
So an item of clothing bought off a UK-based website for €167 might end up costing a consumer €236.32 once VAT and other charges are added to the price if the product does not originate in the UK.
Some retailers, such as Next, have gotten around any potential issues by creating an Irish company, while others, such as Asos, say you will be able to avoid any new customs duties or import taxes as it will ship to Ireland from its EU-based warehouse.
Others are looking to incorporate any additional charges into the overall price at the point of purchase.
The Revenue spokesman told The Irish Times that consumers here “need to be vigilant when buying goods from the UK (excluding Northern Ireland). Consumers need to be sure of what they are buying, where the good(s) originated from and the T&C’s provided by the supplier in relation to returns and refunds.
“Goods coming from Great Britain are regarded as imports and Irish VAT will apply if the value of the good(s) is over €22. This position stands even if consumers are charged UK VAT on their purchase. In this instance the consumer will need to seek a refund of the UK VAT from the supplier.”