Tax rises even more likely, if OBR wipes out Reeves’ magic GDP boost from Starmer’s rocky EU re-set deal

“The EU beggars belief,” says MP, as its new threat could add £bns to Reeves’ budget ‘black hole’

Montage © Brexit Facts4EU.Org 2025

EU’s latest threat comes on top of 50% steel tariffs, with no reply from “spineless and obsequious Government”

The Members of the Office for Budget Responsibility are most certainly avid readers of the pro-EU Financial Times. They will have read Thursday’s FT article, revealing that Sir Keir Starmer’s headline ‘win’ from his EU reset negotiations is now under serious threat of being put on hold. Aside from this being another acute embarrassment following the PM’s much-vaunted Reset Summit, it has major repercussions for Rachel Reeves’ ‘black hole’ in her budget calculations.

With the OBR now most likely to exclude the Chancellor’s magic GDP boost she has predicted from the EU agri-food (SPS) deal negotiated by her boss, Ms Reeves will find she must raise taxes even more, if she is to stick to her inviolable fiscal principles.

With steel piling pressure on PM, the EU’s hardened stance will come as a hammer blow

Last week the EU not only announced the imposition of 50% tariffs on its imports of UK steel, they also told the Starmer government it wasn’t “crossing all the ‘i’s and dotting all the ‘t’s” in its border arrangements in the Irish Sea, thereby putting his entire future agri-foods deal at risk. Whilst the latter news was communicated in an off-the-record briefing, the EU made sure they used the Financial Times to ensure the message would be read and understood.

This is an added humiliation for the PM, after he gave the EU everything it asked for in his ‘re-set’ deal. It is the agri-foods (SPS) agreement that will have impacts across the entire UK, in addition to those already being suffered by businesses in respect of Northern Ireland.

“They’ve cut the UK in two, and still they want more!”
“It beggars belief”
- Jim Allister KC MP, 10 Oct 2025

Even worse for the Sir Keir Starmer’s Government, this could be another massive blow to his Chancellor Rachel Reeves’ budget plans, as she had been hoping to persuade the Office for Budget Responsibility to include an economic uplift from this SPS agreement in its forecasts. She is now highly likely to be facing an even deeper black hole.

What the EU said, and what it means for looming tax rises and for Sir Keir’s crumbling credibility

The latest set-back in Sir Keir’s attempts to improve relations with the EU by succumbing to its demands came when two EU Commission officials told the EU’s favourite British newspaper, the pro-EU Financial Times, that Starmer’s entire agri-foods deal with the EU was now in doubt.

The FT reported one senior official, speaking anonymously, as saying: “If they don’t do what they promised already, why would we trust them with a bigger deal?”

The EU’s complaint is that the UK Government has not been fully enforcing the border in the Irish Sea, which makes England, Scotland and Wales ‘third (foreign) countries’ as far as Northern Ireland laws, imposed by the EU, are concerned. British products being sent over to Northern Ireland from GB are treated as crossing an international border.

The reason for this is of course that when the UK exited the EU, it left Northern Ireland behind in the EU’s Single Market. This separation was further underlined by the subsequent ‘Windsor Framework’ signed by Rishi Sunak.

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It now seems that the EU Commission is finding fault with the details of the way products are being checked – products going from one part of the United Kingdom to another. As a result, they are saying that they will not extend the ‘SPS’ agri-food regulations to the rest of the UK.

The supreme irony is of course that the EU sells the UK far more food products than the UK sells to the EU. It is the EU27 who will be the prime beneficiaries of the SPS deal, if the detail of it is agreed.

The same is true of steel. The EU sells the UK far more steel than it buys from the UK. The implication of this is that if the Prime Minister responds with a swift and robust response, threatening retaliatory tariff action on steel products, there will very quickly be EU producers queueing at Commissioners’ doors in Brussels, complaining bitterly and threatening to go public.

Unsurprisingly, the news in the UK provoked a reaction

Late on Friday, Brexit Facts4EU was given the following statement from Jim Allister KC MP, Leader of the TUV party and a vocal critic of the government, which we have shared with GB News. This sums up the views of many.

Statement supplied to Brexit Facts4EU.Org by Jim Allister KC MP, Leader of the TUV

Response to EU demands for tighter enforcement of the Irish Sea Border

Below are some excerpts from Jim Allister's statement.

For the full text please click here.

“It beggars belief that the European Union, which has had the audacity to disrespect the territorial integrity of the UK and assume the right to divide our country into two through the imposition of a customs and international SPS border, should now grumble because they say that our spineless and obsequious Government is failing to dot all its ‘i’s and cross the ‘t’s as they affect our humiliation."

"No goods can move from Great Britain to Northern Ireland without having to negotiate the obstruction of an international border that should not be there. To do so they require, at minimum, an export number, some customs paperwork and in the case of SPS goods, some international SPS paperwork, with some checks at the nearly £190+ million Border Control Posts paid for by the British tax-payer to cut ourselves in half. And that’s just the Green Lane!"

"...what we need is a government that has the boldness to stand up to the EU for the people of the United Kingdom... An entity that wishes to affect our humiliation in order to know it can trust us, is not an entity that we can trust."

"...the solution is not for that humiliation to be extended to the rest of the United Kingdom through a demanding SPS Agreement. The British people voted for Brexit because we want to be able to make our own laws not because we want to give up having any voice in the setting of any of our legislation."

"Even with a UK wide EU SPS Agreement, the Irish Sea Border will remain in place."

"It is the kind of thing loved by our current Government ... denying the Chagossians self-determination, giving their island to Mauritius, bending over backwards to accommodate China, recognised to constitute a threat to national security, the biggest embassy in London etc etc."

"What we need is a solution ... provided for by my EU Withdrawal (Alternative Arrangements) Bill which any Government that believed in Britain could adopt at any time."

Observations

The EU has inadvertently told us how to avoid the disenfranchisement of the whole UK on food and animal health matters – just don’t fully implement the Windsor Framework. Unfortunately we do not believe this will be the response of the current Government.

There is already demonstrable evidence of the diversion of trade in Northern Ireland. Companies are having to source from the Republic, as GB producers are finding it isn’t worth the effort and cost to continue to supply customers in the Province. This in itself is enough for the British Government to invoke clauses in the Treaty to suspend or annul it.

Facts4EU’s position has always been that the EU has deliberately ‘annexed’ Northern Ireland as a punishment for Brexit. What makes this far, far worse is that there was never any threat to the EU’s Single Market and solutions were available without the need for any Irish sea border. We published detailed reports many times, proving this.

Sadly, we have had pro-Remain and weak governments which have allowed this situation to persist. At the next election the voters will have an opportunity to vote for a party which will scrap the current arrangements and we sincerely hope this happens.

Only then will we be able to stand proudly on the world stage as a fully independent United Kingdom.

Please, please help us to carry on our vital work in defence of independence, sovereignty, democracy and freedom by donating today. Thank you.

[ Sources: Jim Allister KC MP ] Politicians and journalists can contact us for details, as ever.

Brexit Facts4EU.Org, Mon 13 Oct 2025

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Reader Comments 9

1. Sparky , Monday, October 13, 2025, 07:32:

Brexit issues laid bare.
.
EU tariffs are for all steel imports to the EU, not just the UK. 75% (£3bn) of UK exports are to the EU so any gains of lower tariffs on exports to USA mean little. This is a price for being outside the EU. The UK is not being targeted or being victimised as Brexitears would like you to believe. This is a cost of Brexit.
.
Northern Ireland is another cost of Brexit. When the UK and Republic of Ireland were both inside the EU, the bloody cause of the Troubles for a United Ireland became irrelevant and allowed the Good Friday Agreement to happen.

2. Gazzablack , Monday, October 13, 2025, 07:54:

1, sparkless
.
But we have a trade agreement with the EU.
.
So if the EU can impose tariffs on UK steel while that agreement is in effect, then the UK can:
Impose tariffs on beef and dairy products from Ireland
Cars from Germany and France
Wines from France
.
Maybe even disapply EU fishing rights in UK waters.
.
.
Your comment on Ireland is fatuous and irrelevant.
The ROI only joined the RED because we did
The ROI only adopted the Euro because the Irish believed that the UK was going to.
.

3. NH , Monday, October 13, 2025, 09:58:

South Africa has already stated that the EU's SPS regulations will prevent them from exporting Citrus Fruits to the UK so the only option will be to pay the prices that Spanish exporters choose to charge UK consumers. They claim that EU food regulations, which have increased significantly since Brexit, are unscientific and protectionist and they have taken 2 cases to the WTO against the EU.
.
The tariffs on UK steel are a very easy negotiation. The UK is the EU's largest market in the world for car exports. If the EU puts tariffs on UK steel imports we should retaliate by putting tariffs on any EU product containing steel. We are presently subsidising EU car imports into the UK by giving large government paid discounts, or large tax incentives, on Electric Vehicle imports. This is madness the Government is subsidising a trade deficit.
.
The UK car market is changing we are now the largest export market for BYD in the world. In the September sales figures Jaecoo was the 4th largest seller, BYD was 6th and MG was 8th. It seems that UK consumers like cheap, good value cars. If the EU has any sense it will treat it's major trading partners as customers or it will continue with it's sad decline.

4. Mr Sceptic , Monday, October 13, 2025, 10:06:

Margaret Thatcher once said: ‘We can play a leading role in Europe, but if that leadership is not forthcoming, Europe will develop without Britain.
Britain, if she denounced the Europe Community, cannot then complain if the European Community develops in conflict with Britain's interests.’
Yet what are the Brexiteers complaining about?

5. NN , Monday, October 13, 2025, 10:23:

4. Sceptic
Your Margaret Thatcher quote was made in 1975 when the EU was a trading area, she changed her views radically when the EU decided to become a Political Union. The complaint's are not about Brexit they are about the Government's "realignment" with the EU which is clearly not working. It's world market's that are changing, the EU is stuck in the past and constantly returning to protectionism. The UK is now free to take advantage of all the opportunities in the world !

6. Sparky , Monday, October 13, 2025, 11:05:

2 G. Your comments reveal the lack of understanding by Brexitears before and since the ref:
.
We have a trade agreement with the EU via the CTA but we’re not in the EU so the UK will be affected unless the Govt can do a deal.
.
So my comments on NI are fatuous, the fact you and Brexitears in general think NI is silly or pointless does not surprise me. Brexit dismissed the warnings on NI.

7. Ashley Great Britain , Monday, October 13, 2025, 11:13:

4 Mr Sceptic
-
Were not complaining about Brexit or what the EU does. We're complaining that the UK Government's are not using our independence, or standing up for us.
Of course the EU will do whatever they want in their best interests, fine. But so should the UK. Sadly there's no political will to treat the EU how they treat us, and Labour are enabling more damage for the uk by basically rejoining the block.

8. Gazzablack , Monday, October 13, 2025, 11:48:

6, sparkless
Your comment is not only fatuous, it's vaccous as well.
.
And let's not forget it was the remainiacs that Made Ireland a political football, not Brexiteers
.
.
4, septic
.
Margaret Thatcher later said that :
We have not embarked on the business of throwing back the frontiers of state at home only to see a European super state getting ready to exercise a new dominance from Brussels".
.
And in response to Jacques Delors call for more European integration her answer was an unequivocal "No No No"

9. Gazzablack , Monday, October 13, 2025, 11:57:

The FT has found that 59 MEPs are moonlighting in roles related to policy areas they regulate on, with only 8 of them actually declaring a h potential conflict of interest.
.
The FT found more than two dozen MEP's working on files that appear directly related to their side gigs.

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