Post-Brexit UK to create freeports to court foreign investment
Chancellor Rishi Sunak said sea, air and rail ports in England will be invited to bid for freeport status before the end of this year, with the government aiming for the first of the new sites to be open for business in 2021.Updated: Oct 07, 2020, 14:37 IST
As the UK’s final exit from the European Union on December 31 draws near, the Boris Johnson government on Wednesday announced the creation of freeports that will offer tax reliefs, simplified customs procedures and duty suspension on goods.
Chancellor Rishi Sunak said sea, air and rail ports in England will be invited to bid for freeport status before the end of this year, with the government aiming for the first of the new sites to be open for business in 2021.
A firm can import goods into a freeport without paying tariffs, process them into a final good and then either pay a tariff on goods sold into the domestic market, or export the final goods without paying UK tariffs.
Officials said the freeports are designed to attract major domestic and international investment, the hubs of enterprise will allow places to carry out business inside a country’s land border but where different customs rules apply. They have been successfully used in countries around the world to drive prosperity and boost trade.
Sunak, said: “Our new freeports will create national hubs for trade, innovation and commerce, regenerating communities across the UK and supporting jobs.”
“They will attract investment from around the world as we embrace new opportunities following our departure from the EU and will be a key driver for economic recovery as we build back better post coronavirus.”
Besides freeports in England, the government plans to set up at least one freeport in Scotland, Wales and Northern Ireland.
The government will also introduce a package of tax reliefs on investment by businesses within freeport tax sites, new measures to speed up planning processes to accelerate development in and around freeports.
The freeports are to be selected through a fair, transparent and competitive process, and will be expected to collaborate closely with key partners across the public and private sectors. The bidding process for locations to become a freeport in England will open by the end of 2020.