Brexit: Opportunities for growth
Opportunities for NI Hospitality & Tourism Businesses
Northern Ireland’s unique post-Brexit trading position resulting in “unfettered” market access, in respect of goods, to both Great Britain and the European Union has the potential to attract significant manufacturing businesses from around the globe, who trade with both GB and the EU, to ‘set up shop’ in Northern Ireland.
With GB’s position as a significant distribution hub pre Brexit being dramatically weakened given the customs formalities to be undertaken and the costs associated with same, many distribution company’s in GB could consider setting up business in Northern Ireland to continue to service the EU market.
The impact of new businesses establishing a base in Northern Ireland, coupled with the associated job creation, has the potential to support the Hospitality and Tourism sector significantly. With discretionary spend increasing as a result of increasing employment, coupled with the utilisation of conference spaces for off site business meetings and events together with many businesses placing significant emphasis on health and well being, businesses across the Tourism & Hospitality in Northern Ireland should witness opportunities for growth if businesses capitalise on the benefits of NI’s position to trade with two of the world’s largest markets.
Northern Ireland – A Shopping Destination
With limits placed on duty free shopping between GB and Ireland, and given there are no limits on the movement of goods across the island, there could be scope for NI to become a convenient place for high-value shopping in the future.
Northern Ireland- VAT Opportunities
Under the NI Protocol NI businesses are in a truly unique position in that they remain within the UK VAT regime but EU VAT rules continue to apply to the supply of goods. This enables NI businesses to continue to avail of a number of EU VAT procedures and simplifications that their GB based counterparts are no longer entitled to avail of. These opportunities include:
NI based businesses can continue to avail of the EU VAT Retail Export Scheme (VAT RES Scheme), thereby remaining entitled to refund VAT to tourists from outside the EU and Northern Ireland.
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NI established businesses can continue to use the Electronic VAT Refund (EVR) System to reclaim VAT incurred in the EU on goods whereas GB based businesses will need to adopt a new process in order to reclaim VAT incurred in EU member states.
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For NI businesses reliant on ecommerce as a sales mechanism, the Union One Stop Shop can be used to account for VAT due in various EU member states. In contrast the sale of goods from GB businesses to private consumers in the EU will be subject to import VAT and may result in additional EU VAT registration requirements.
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Unlike GB business, NI businesses can continue to avail of the triangulation simplification and the call-off stock simplification, both of which relieve VAT registration obligations when engaged in complex supply chains with businesses in other EU member states. GB companies are no longer entitled to avail of either of these simplifications, creating potentiFor NI businesses reliant on ecommerce as a sales mechanism, the Union One Stop Shop can be used to account for VAT due in various EU member states. In contrast the sale of goods from GB businesses to private consumers in the EU will be subject to import VAT and may result in additional EU VAT registration requirements.
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The special position of NI businesses under the Protocol ensures that businesses can continue to trade seamlessly with consumers based throughout the EU and if opportunities are embraced willoften place NI businesses at an advantage as compared to businesses operating elsewhere in the UK.
This content has been produced on behalf of Tourism NI by PKF-FPM Accountants.