Amazon halts alcohol sales in Northern Ireland and prepares to de-list more products due to new Brexit customs rules
Amazon has stopped selling wines, beers and spirits to its customers in Northern Ireland as it wrestles with new customs rules post-Brexit. The online retailer is concerned that excise duty - a tax - will now have to be paid twice on all shipments of alcohol which are sent from the British mainland across the Irish Sea.Amazon’s suspended orders in Northern Ireland at the end of December, shortly after the UK/EU trade deal was published, and the decision is unlikely to be reversed until the company obtains clarity on the tax situation from HMRC. One Amazon customer from Belfast, who didn’t want to be identified, told ITV News his subscription for a delivery of whisky every three months had been cancelled. “My biggest issue is they will no longer supply any alcohol to Northern Ireland, despite me being a Prime customer and having bought hundreds of items over the past fifteen years,” he said.
And there may be many more delistings to come.According to industry sources, Amazon is considering halting the sale of a large number of other products to Northern Irish customers - including pet food, organic food supplements and some over-the-counter medicines - before the end of March when customs regulation becomes more onerous.From the 1st April, all deliveries of products of animal origin, sent from mainland Britain to Northern Ireland, will need to be accompanied by Export Health Certificates (EHC) which need to be signed-off by a vet.
At the moment there is a grace period in place for supermarkets and bigger suppliers.Amazon is concerned that the burden of the extra customs paperwork coupled with the requirement for physical checks will be too costly and disruptive, running the risk that lorries carrying thousands of Amazon parcels - many of which won’t require EHCs - get held-up at the border.
“These customs checks and import taxes highlight that the Brexit Withdrawal Agreement effectively annexed Northern Ireland as a Customs enclave of the EU,” said Richard Asquith, a Vice President at Avalara, a tax advisory firm. “The last-minute agreement in December 2020 on the practical customs checks on goods left Amazon, other marketplaces and all UK traders no time to adjust their processes or charging for the new rules. So many are now simply stopping selling until they can pivot. "The risk for UK businesses in the meantime is that the NI shoppers turn permanently to EU businesses who don’t face these Brexit barriers.”The Northern Ireland Protocol - which was part of the Brexit Withdrawal Agreement - avoided the need for a hard border on the island of Ireland by creating a customs border down the Irish Sea.
The result is that, since the UK left the EU’s Single Market and its Customs Union at the end of last year, trade across the Irish Sea has been significantly disrupted. TK Maxx, Dunelm, and John Lewis, have responded to the cost and inconvenience of extra customs paperwork by cancelling online deliveries.It is striking that even Amazon - the most successful retailer in the world with its own formidable logistics network - is having problems making the new rules work.
In a statement, a spokesperson from Amazon said: “We are planning and preparing for April 1st end of the grace period so we can continue to serve our customers in Northern lreland who count on Amazon with the broadest possible selection of products.”
Demand for groceries has soared in lockdown but in Northern Ireland Brexit is causing supply issues.Earlier this month the major supermarkets warned the government that the new certification requirements which are set to be introduced in April are “unworkable”. The chief executives of Tesco, Sainsbury’s, Marks and Spencer and Asda, said “urgent intervention” is needed to prevent further disruption to food supplies in Northern Ireland.
A government spokesperson said: “These goods will not be taxed twice, and we will issue new guidance clarifying the position to ensure any remaining issues are addressed."