Brexit could cost every household in the UK as much as £3,600 once the economy has taken the full impact of leaving the EU, new analysis suggests.
The independent Office for Budget Responsibility (OBR) has already estimated that the UK will suffer a 4% hit to economic output over the 15 years after the EU referendum of 2016.
And the total cost of that economic damage would amount £3,600 for every UK household over that period, or around £240 a year, Commons library research commissioned by Labour suggests.
The 4% reduction in economic output also means an £84.5bn hit to the economy over 15 years, additional Labour analysis of official statistics suggests.
Shadow Cabinet Office minister Rachel Reeves urged on the government to “build on the [trade] deal” signed by Boris Johnson at Christmas to improve the situation.
The OBR also anticipates a 0.5% reduction in the UK’s GDP for the first quarter of 2021 due to trade disruption since the country left the European single market at the end of the Brexit transition period on December 31.
The short-term disruption of new border checks and regulations amounts to around a £2.7bn hit to the UK economy in just three months.
Earlier this month, Reeves raised concerns that chancellor Rishi Sunak’s Budget did not address the OBR’s prediction.
She also wrote to the fiscal watchdog asking for it to share details of the “economic impact assessment the chancellor should have done himself”.
Reeves said: “This government not only left businesses high and dry with their last minute, limited deal, but now seem to think all their work is done here.
“They need to look at the impact of the new trading rules, face up to the challenges by working alongside businesses – not against them – and build on the deal to make it work in the best interests of the British people.”
It comes after the EU this week launched legal action against the UK for what Brussels said amounted to a breach of its own Brexit withdrawal agreement, and international law.
A government spokesperson said: “Our deal with the EU represents one of the most comprehensive free trade agreements ever signed, and it’s a good deal for British families, businesses and jobs.
“It gives us a fantastic platform by maintaining tariff free access to European markets, but also capitalises on new opportunities, by signing new trade deals, and trying new things like introducing freeports which will create jobs, drive investment and increase trade.”