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·
11mo ago

New Analyses Put Brexit’s Long-Run Cost Higher as Reeves Finalizes Budget

Fresh studies quantify larger GDP losses with major tax shortfalls, intensifying scrutiny of fiscal choices.

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Labour MP Rachel Reeves who has served as the Chancellor of the Exchequer since July 2004 photographed at Swinnow Primary School in Leeds, west Yorkshire.
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Overview

  • House of Commons Library estimates Brexit is depriving the Treasury of up to £90bn a year in tax revenue.
  • The analysis also puts the hit to GDP per head at roughly £2,700 to £3,700 since the 2016 referendum.
  • A National Bureau of Economic Research study finds UK GDP is 6% to 8% smaller than it would have been, a more negative long-run impact than earlier five-year assessments.
  • A separate survey of 7,000 firms reports worse EU trading terms and estimates a 6% to 8% macro hit alongside declines in investment (12%–18%), employment (3%–4%) and productivity (3%–4%).
  • Political reactions diverge as pro-EU figures cite the findings to press for closer ties with Brussels, pro-Brexit groups point to ONS-based charts showing gains in real GDP and GDP per head, and the Treasury declines comment ahead of Rachel Reeves’s Budget, with the Chancellor saying the OBR will be “pretty frank” about the impact.