Downing Street rules out EU customs union membership

UK Prime Minister Theresa May sought to heal a widening division among ministers over Brexit on Monday when she said Britain would not remain in the customs union after leaving the EU.

An official source was quoted by British media as saying: “It is not our policy to be in the customs union. It is not our policy to be in a customs union.”

Chancellor Philip Hammond, and the Business Secretary, Greg Clark, were reportedly in favour of staying in a customs union for goods.

However, International Trade Secretary and a proponent of a 'hard Brexit' Liam Fox, last week dismissed the idea out of hand, saying it would hinder the UK in making free trade deals elsewhere.

“It is very difficult to see how being in a customs union is compatible with having an independent trade policy, because we would therefore be dependent on what the EU negotiated in terms of its trading policies, and we’d be following behind that,” he said," he said in a television interview.

The clarification from Downing Street on Monday came as May and Brexit Secretary David Davis prepared to meet chief EU negotiator Michel Barnier ahead of the next round of talks.

Staying in the customs union would give the UK tariff-free trade within the EU, but it would lose the ability to agree trade deals with countries outside the bloc.

Labour MP Hilary Benn, who chairs the Brexit select committee, said there was still confusion around what the government wanted from a final deal.

“I think the government is in a state of open disagreement. The prime minister has been immobilised. We’re 19 months since the referendum … and we still don’t know what it is we want," he told the BBC.

“I think it’s a profound mistake to leave a customs union with the European Union.”