Brexit refers to the UK's decision to leave the European Union. The EU is a political and economic union of 28 countries that allows free trade and movement between members. In 2016, a referendum was held and 51.9% voted to leave the EU. The process of leaving has begun, but the future relationship between the UK and EU remains unclear - it could involve remaining in the single market like Norway, or a looser trade agreement like Canada. Legal and tax consequences will depend on if a "hard" or "soft" Brexit is pursued. Negotiations are ongoing to determine the new relationship.

1. Brexit

2. What I am going to talk
about
What is Brexit?
What is EU?
Why the UK voted for Brexit
The Process
Likely UK – EU relationship: hard or soft Brexit?
Legal consequences
Tax consequences
Conclusion

3. What is Brexit?
Brexit is short for "British exit" - and is the word people
use to talk about the United Kingdom's decision to
leave the European Union (EU).

4. What is the EU?
The EU is a political and economic union of 28 countries which
trade with each other and allow citizens to move easily between
the countries to live and work .
The UK joined the EU, then known as the EEC (European
Economic Community), in 1973.

5. Why the UK voted for Brexit
23 June 2016 – Referendum: “Should the United
Kingdom remain a member of the European
Union?”
Result:
• Remain: 48.1%
• Leave: 51.9%
A revolution
Note – very little discussion before Referendum on
what leave would actually mean
Understanding the politics of why UK voted to
leave helps to predict what the legal and tax
consequences will be

6. The Process – So far: 2016
24 June – Referendum result. Cameron
resigned as Prime Minister
13 July – Theresa May became Prime Minister:
“Brexit means Brexit”
July – new ministries for Brexit and for
International trade set up
November – legal case against Government’s
attempt to trigger Article 50 without
Parliament’s approval

7. Likely UK – EU relationship post-Brexit
Context:
 UK imports from EU - €341 Billion
 UK exports to EU - €260 Billion
If there is no agreement, everyone suffers: UK is third biggest
export market for each of France, Germany and Holland. About
50% of UK exports are to the EU.

8. Likely UK – EU relationship post-Brexit – Soft or Hard?
 “Norwegian Model”: EEA + EFTA = NO
 Implement most EU rules with no “seat at the table”
 Free movement of people
 Pay into EU budget
 “Swiss Model”: bilateral agreements + EFTA = NO
 Free movement of people
 Pay into EU budget
 “Canadian Model”: Free Trade Agreement = MAYBE
 Complex and lengthy negotiations: 10 years?

9. Legal Consequences
So what are the legal consequences of a hard Brexit?
 Half of UK environmental law comes from EU law
 Maybe pressure after Brexit to make UK law more business friendly
 CJEU judgements likely to be persuasive (like the judgements of other common
law countries are now)
 Brussels Regulation on reciprocal enforcement will no longer apply in UK so
specific agreement likely to be needed
 Despite Brexit, The EU General Data Protection Regulation will come into effect
in UK in May 2018

10. Tax Consequences – main UK
taxes and their rates
 Corporation Tax on businesses: 20% now but
falling to 19% April 2017 and 17% April 2020
 Value Added Tax (“VAT”) on supply of goods
and services: 20%
 Income Tax on individual’s income:
 Not paid on first €13k then
 Next €13k to €50k @20%
 Next €50k to €177k @40%
 Over €177k @45%

11. Brexit - Conclusion
 It is written into law that the UK will be leaving.
The European Court of Justice has said the UK could cancel
Brexit altogether without the agreement of other nations, but
politically, that's not likely to happen.
 "No deal" means the UK would have failed to agree a
withdrawal agreement.
 That would mean there would be no transition period after
the UK leaves, and EU laws would stop applying to the UK
immediately

12. THANK YOU