Ireland has experienced a significant financial boost, receiving an additional €700 million from customs duties on imports like clothing, food, and other goods from Great Britain following Brexit.
Previously, as a member of the EU’s single market and customs union, Britain exported goods to Ireland without customs duties. However, the Brexit agreement led by Boris Johnson, which saw the UK leave the single market, introduced new checks and tariffs on British exports to the EU.
Recent statistics indicate that Ireland’s customs revenue surged by 90% between 2020 and 2021, coinciding with Brexit’s implementation. Even accounting for the pandemic’s impact, there was a marked revenue increase over the three years following Brexit. For instance, in 2021, customs revenue rose by 52%, amounting to a €178 million increase compared to 2019. The following year saw an 80% increase, adding an extra €617 million, and in 2023, there was a 72% rise.
A report from the Irish Revenue Commissioners highlighted significant customs duty contributions from imports originating from China, though it emphasized that the major changes were primarily due to Brexit. It noted, “Customs duties have essentially doubled in recent years following the reclassification of Great Britain as a third country in 2021.”
Great Britain emerged as the leading origin country for both the duties collected and the value of imported goods, contributing nearly half (45%) of Ireland’s total customs revenue last year, approximately €264 million.
Data suggests that Brexit accounts for nearly all the customs revenue increase over the past three years. David Henig, Director of the UK Trade Policy Project at the European Centre for International Political Economy, commented, “This might be seen as positive for Ireland, but it also highlights the costs associated with Brexit, including who bears the burden of these customs duties—whether exporters absorb them or pass them onto consumers.”
Not all goods are subject to tariffs; those adhering to rules of origin and predominantly manufactured in the EU or the UK are exempt under the Brexit trade deal. Henig pointed out that some of Ireland’s tariff revenues might come from non-EU goods stored in Great Britain for distribution in both the UK and Ireland, such as clothing from India, Bangladesh, or Morocco.
Before the UK left the EU, many goods destined for Ireland were routed through UK distribution centers, with the UK collecting customs duties on the EU’s behalf. Post-Brexit, Ireland is now responsible for collecting these duties directly.
Under EU regulations, Ireland retains 25% of the collected duties, with the remaining funds contributing to the EU’s central budget.
In 2023, the largest sources of customs revenue in Ireland included apparel and clothing accessories, amounting to about €146 million, followed by plastics, vehicles, and footwear, among others.
The financial impact of Brexit is evident across the EU but is particularly significant in Ireland due to its extensive trade relationship with Great Britain, one of its largest trading partners. According to HMRC data from April 19, 2023, Ireland is the UK’s sixth-largest trading partner, with exports totaling £57.6 billion.
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