Brexit news: Whats happening now? Liz Truss poised for EU showdown

Boris Johnson compares Ukraine war to the UK's vote for Brexit

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Ministers have already met a selection of new challenges in 2022, including war in Europe, continued Covid misery and a cost of living crisis on the cards. They have also divided EU attention, with several member states bordering Ukraine accepting refugees and providing military support for the country’s remaining fighters. Getting the right Brexit remains a challenge, having taken the backseat while leaders concentrate their energy elsewhere, but there have been some developments.

The Northern Ireland protocol

The most controversial aspect of the Brexit deal, the Northern Ireland Protocol, was one of the Government’s own making.

Ministers negotiated and celebrated the protocol as a pragmatic solution to dividing the UK from the EU at the Northern Irish border without infringing on the Good Friday Agreement.

Once lauded as a “great deal” by Boris Johnson, the Conservatives have tried to roll back the policy, citing trade difficulties and separation within the union.

Mr Johnson told Irish Taoiseach Micheál Martin the deal required “significant changes” in a meeting on March 13, with a Downing Street spokesperson confirming he hoped for “greater ambition and flexibility” from the EU.

Mr Martin added that Northern Irish businesses welcomed the protocol, adding they “want to continue access to the EU single market”.

He added: “It’s a good basic principle to start off on.”

Article 16

With the debate on the Northern Ireland Protocol comes one on Article 16.

The article is a safeguarding mechanism employable by the EU or UK should the protocol impact their ability to trade across the Irish Sea.

Specifically, it states the Foreign Secretary may activate its contents should the protocol lead to “serious economic, societal or environmental difficulties that are liable to persist, or to diversion of trade”.

While officials cannot permanently suspend aspects of the protocol, it has been floated as a solution to the Government’s continued dissatisfaction with the policy keeping Northern Ireland within the EU’s Single Market.

Liz Truss’ thinking on the article appears to have split recently, with reports suggesting she is both ready and willing to trigger its parameters and holding back to focus on Vladimir Putin.

The Times recently reported that she has “lost faith” with EU negotiators and might suspend parts of the protocol ahead of Northern Ireland’s May elections.

Trade deals

Exiting the EU meant the UK was free to pursue more lucrative deals without having to opt-in to collective terms negotiated by one international entity.

Over the last two years, British trade and foreign secretaries have not dragged their feet, with several new deals now operational.

They have focussed their efforts in the pan-Pacific, creating free trade agreements (FTAs) with New Zealand, Australia and Japan, adding them to the nearly 50 rolled over from EU membership.

Although promising, these much-touted deals may not add much to the economy.

Economists expect the Australia deal alone will add just 0.02 percent to British coffers over the next 15 years, and the “agreement in principle” with New Zealand will add only £800 million over the next decade.

Relations with the EU

The UK’s campaign against the EU tanked relations with the bloc. But while negotiations left ill-feeling on both sides of the channel, they have started to recover.

War in Ukraine has caused most countries to refocus their foreign policy, meaning the UK’s aims now align with those of the EU.

That has given officials a vital opportunity to reset their relationships, one which the Government has taken advantage of.

Mr Johnson has more regularly appeared alongside his European counterparts, with enhanced communication on levelling sanctions on Russian oligarchs and their associates.

On Thursday, the Prime Minister met with EU Council President Ursula von Der Leyen and the two committed to “continue working together to diversify energy sources and move away from reliance on Russian hydrocarbons”.

Tax cuts

Taxes featured heavily in Rishi Sunak’s spring statement addressing the House of Commons on Wednesday, as Britons anxiously awaited Government aid packages to counteract the rising cost of living.

One of the announcements included in the Chancellor’s announcement was a pledge to remove VAT on home energy improvements such as solar panels.

He claimed the move would not have been possible while the UK was still an EU member, making it a “Brexit benefit”.

However, his claim that the EU had not moved in its demand for higher VAT rates on environmentally friendly building supplies was incorrect.

While it had previously, the bloc moved to bin its higher rates on building material with an environmental aim last year.

Pending a vote in the European Parliament, member states will have to set a rate between zero and five percent on goods and services that include “supply and installation of solar panels on, and adjacent to, private dwellings, housing and public and other buildings used for activities in the public interest”.

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