Government acts to reduce customs paperwork for businesses

International trade is at the forefront of the UK Government’s aims for business expansion, but UK companies have often voiced their concerns about the time and money spent on the paperwork caused by meeting seemingly onerous Government regulations.

In response, the Government seized the opportunity to help businesses, and commissioned independent auditors KPMG to produce a report, Administrative Burdens – HMRC Measurement Project, to quantify the true costs of meeting these obligations.

Report brings understanding

A primary aim of the report was to give the Government a better understanding of the way the complexities of its procedures were perceived by enterprise.

Undeniably there are problems – the results showed that around 15 per cent of the total cost of complying with regulation related to customs obligations alone.

Businesses can save around 26 per cent of the cost of filing a paper customs declaration by performing the whole process electronically.

There was also some evidence suggesting that some businesses – notably smaller concerns and manufacturing – were discouraged from trading internationally due to the obstacles they faced.

Simplification brings benefits

But the report did identify areas where the UK administration processes themselves could be simplified, in spite of much customs legislation emanating from the European Union and the need for cross-border compatibility.

For example, electronic filing is popular, so businesses can save around 26 per cent of the cost of filing a paper customs declaration by performing the whole process electronically.

An example of where this works well is the National Export System (NES), implemented at all ports from 2002, which allows exporters or their agents to send their export declarations to HM Revenue & Customs (HMRC) electronically.

Targets to reduce bureaucracy

As a result of the report’s findings, targets have been set under a five-year plan, with the aim of simplifying processes.

In particular, all exporting and importing practices are to be reviewed to see how they can be made easier.

Two major targets include reducing the need for businesses to submit forms by 10 per cent and reducing the burden of dealing with audits and inspections by 15 per cent – both significant reductions to current requirements.

Industry personnel closely involved

To oversee the programme to meet these objectives, the Joint Consultative Committee on Customs – a body formed of representatives drawn from various industries involved in international trade – is monitoring and advising on progress and developments.

Above all, in these endeavours, the UK Government is fully focused on demonstrating its commitment to reducing the administrative burdens on business in a progressive and sustained way in order to boost and maintain the UK’s international trading base, both now and in the future.