1. Summary

This publication details the extent to which preferential tariffs have been used for the United Kingdom (UK) trade in goods with partners in 2021 for:

• UK imports from non-EU partners
• Great Britain (GB) imports from EU member states^{[footnote 1]}
• GB exports to EU member states
• UK exports to non-EU agreement partners

Preferential tariffs are reduced rates of customs duty offered under preferential trade agreements (PTA) and the Generalised Scheme of Preferences (GSP) between the UK and its partner countries or territories.

Preference Utilisation Rates (PURs) measure the extent to which tariff preferences provided by trade agreements are being used, for goods where preferential tariff rates are available and lower than the Most Favoured Nation (MFN) rate^{[footnote 2]}. A country or territory’s PUR, normally presented as a percentage, reflects the value of goods imported under trade preferences, as a share of the total value of imports eligible for preferences.

PUR for UK imports on a country of origin basis is drawn from HM Revenue and Customs (HMRC) imports by preference data. For exports, the publication relies on data provided by free trade agreement (FTA) partners who have agreed to exchange the data required for this analysis, which for this release is as follows:

• Canada
• Chile
• Costa Rica
• El Salvador
• Guatemala
• Honduras
• Iceland
• Japan
• Kosovo
• Nicaragua
• Norway
• Panama
• Serbia
• Singapore
• South Korea
• Switzerland and Liechtenstein
• Turkey
• Ukraine
• Vietnam
• all EU27 member states

PURs can differ for several reasons including:

• length of entry into force of the FTA
• transaction value
• preferential margin
• compliance and administration costs to the trader
• non-direct consignment route
• awareness of the FTA
• product specific rules of origin

The exact reasons behind the preference utilisation cannot be determined by the PUR data itself and will only be known by the trader.

See the accompanying technical annex for further detail on this publication.

2. Preference utilisation headlines                              

In 2021:

36 trade agreements were in force between the UK and its trading partners including the EU-UK Trade and Cooperation Agreement (TCA), as well as the Generalised Scheme of Preferences (GSP).

90.2% of goods imported into the UK made use of preferences where one was available.                       

88.1% of goods entered the UK tariff free^{[footnote 3]} – 58.7% did so under MFN terms, 28.0% did so under FTA preferences, and 1.3% did so under GSP preferences.   

77.7% of goods exported from Great Britain (GB) into the EU27 made use of preferences where one was available.

69.6% of goods exported from UK to South Korea (the partner with the highest value of total preference eligible exports from the UK) made use of preferences where one was available.

89.1% of goods exported from UK to Turkey made use of preferences where one was available. Turkey had the highest value of UK exports that used a preference (£2.1bn).

86.9% of GB goods entered EU27 partners tariff free – either through preferential terms (38.9%) or MFN terms (48.1%).    

Source: Department for Business and Trade (DBT)                                                                   

3. UK imports by preference                                 

Table 1: preference utilisation of top 10 non-EU partners where a trade agreement is in effect in 2021, by value of preference eligible imports

Turkey was the top non-EU partner in terms of value of preference eligible imports (£7,998 million) into the UK in 2021, of which £7,632 million of imports used a preferential tariff rate (PUR of 95.4%).                                                          

Rank	Non-EU Partners	Total imports (£ million)	Preference eligible imports (£ million)	Preference use imports (£ million)	PUR
1	Turkey	10,941	7,998	7,632	95.4%
2	South Korea	4,454	2,300	2,167	94.2%
3	Japan	7,013	2,179	1,194	54.8%
4	Switzerland	7,912	1,999	1,675	83.8%
5	Vietnam	4,576	1,625	1,023	62.9%
6	South Africa	7,605	1,262	1,218	96.5%
7	Morocco	963	890	874	98.2%
8	Norway	26,260	869	803	92.4%
9	Egypt	884	726	694	95.6%
10	Israel	1,502	477	422	88.5%
Not applicable	Total for all Non-EU partners	92,279	24,914	21,576	86.6%

Source: Department for Business and Trade (DBT).                                                                       

86.6% of goods imported into the UK from a non-EU partner made use of preferences where one was available.

93.8% of UK goods entered from non-EU trade agreement partners tariff free – either through FTA terms (22.2%), GSP terms (0.3%) or MFN terms (71.6%).   

Table 2: preference utilisation of Great Britain’s top 10 EU27 partners in 2021, by value of preference eligible imports            

Germany was the top EU27 partner in terms of value of preference eligible imports (£25,609 million) into the GB in 2021, of which £21,900 million of imports used a preferential tariff rate (PUR of 85.5%).                                                          

Rank	EU27 Partners	Total imports (£ million)	Preference eligible imports (£ million)	Preference use imports (£ million)	PUR
1	Germany	50,880	25,609	21,900	85.5%
2	Poland	22,732	17,145	16,328	95.2%
3	France	33,221	14,640	12,535	85.6%
4	Netherlands	22,567	14,399	13,978	97.1%
5	Italy	20,335	11,699	10,293	88.0%
6	Spain	16,263	8,825	8,354	94.7%
7	Belgium	15,018	7,803	7,516	96.3%
8	Portugal	5,909	4,831	4,638	96.0%
9	Sweden	8,092	3,509	3,342	95.2%
10	Ireland	8,360	3,417	3,273	95.8%
Not applicable	Total for all EU partners	238,768	127,185	115,497	90.8%

Source: Department for Business and Trade (DBT).                                                                   

90.8% of goods imported into GB from an EU partner made use of preferences where one was available.

94.7% of GB goods entered from the EU27 tariff free – either through FTA terms (52.0%) or MFN terms (42.7%).         

145 countries or territories made use of a preferential tariff when importing into the UK, whether under a trade agreement or GSP, or other arrangement.

5.2% of goods entering the UK in this period made use of inward or outward processing relief.

4. UK exports by preference           

4.1 Non-EU

The publication relies on data provided by FTA partners. Consequently, the scope on the non-EU export side is limited to those countries or territories that have provided such data. As a result, the release does not include a total for non-EU as the release does not cover all non-EU partners where the UK has a preferential tariff. For UK exports the PUR is calculated using UK calculation methodology, therefore may differ from the partners’ calculated PUR.                                                                                    

Table 3: preference utilisation of UK’s top 10 non-EU partners where a trade agreement is in effect in 2021, by value of preference eligible exports

For the non-EU partners that have currently shared data with the UK, South Korea had the highest value of total preference eligible exports from the UK in 2021 of £3,050 million, of which £2,122 million exports used a preferential tariff rate (PUR of 69.6%), based on UK analysis of data received from South Korea Customs Service.                                 

Rank	Non-EU Partners	Total imports (£ million)	Preference eligible imports (£ million)	Preference use imports (£ million)	PUR
1	South Korea	4,223	3,050	2,122	69.6%
2	Turkey	3,909	2,301	2,050	89.1%
3	Switzerland and Liechtenstein	26,541	1,980	681	34.4%
4	Canada	4,462	951	285	30.0%
5	Egypt	1,311	655	386	58.9%
6	Japan	4,866	617	341	55.2%
7	Chile	451	437	240	54.8%
8	Ukraine	807	340	163	47.9%
9	Vietnam	614	161	7	4.6%
10	Serbia	151	138	52	37.9%

Note: data received from 9 additional trading partners can be found in the supplementary file.

Source: Department for Business and Trade (DBT).               

4.2 EU

Table 4: preference utilisation of Great Britain’s top 10 EU27 partners in 2021, by value of preference eligible exports             

Germany was the top EU27 partner in terms of GB exports eligible for preferential tariffs in 2021 with £9,597 million, of which £6,017 million of exports used a preferential tariff rate (PUR of 62.7%) based on UK analysis of data received from Eurostat.

Rank	EU27 Partners	Total exports (£ million)	Preference eligible exports (£ million)	Preference use exports (£ million)	PUR
1	Germany	24,361	9,597	6,017	62.7%
2	France	17,261	8,903	7,669	86.1%
3	Netherlands	18,758	8,016	6,885	85.9%
4	Belgium	13,380	6,359	5,544	87.2%
5	Ireland	16,543	4,908	3,202	65.2%
6	Italy	6,940	3,268	2,506	76.7%
7	Spain	7,424	3,111	2,496	80.2%
8	Sweden	4,136	1,947	1,511	77.6%
9	Poland	2,742	992	888	89.6%
10	Denmark	1,935	895	709	79.3%
Not applicable	Total for all EU27 partners	123,648	52,999	41,184	77.7%

Source: Department for Business and Trade (DBT), Eurostat.                                                              

77.7% of goods exported from GB into an EU27 partner made use of preferences where one was available.

94.7% of GB goods were exported to EU27 partners tariff free – either through FTA terms (52.0%) or MFN terms (42.7%).

5. PURs by Harmonized Systems (HS) section        

The Harmonized System (HS) of tariff nomenclature is an internationally standardised system of names and numbers to classify traded products. This section is broken down into HS Sections based on HS2 (chapters) using the HS Nomenclature 2021 edition codes.

5.1 UK imports by HS section

Figure 1: total tariff eligible UK imports from non-EU partners in 2021 by HS section    

Transportation equipment made up the largest proportion of UK preference-eligible imports (£6,287 million) during this period (25.2%).

HS Section	Preference eligible imports (£ million)	Imports not eligible for preference (£ million)
Mineral products	186	25,719
Pearls, (semi-)precious stones and metals	249	19,925
Machinery and mechanical appliances	3,596	8,123
Transportation equipment	6,287	1,362
Vegetable products	2,937	1,381
Chemical products	997	2,970
Base metals and articles thereof	956	2,513
Textiles and textile articles	2,591	367
Instruments - measuring, musical	1,108	1,586
Prepared food and beverages	1,794	487
Plastics and rubber	1,689	345
Animals and animal products	936	393
Miscellaneous manufactures	424	697
Paper, printed products	0	517
Wood and wood products	81	414
Articles of stone, plaster, cement, asbestos	222	232
Footwear, headgear	439	14
Fats and oil	267	36
Works of art	0	278
Leather and hides	139	5
Arms and ammunition	14	2

Note: HS 99 not included.     

Source: Department for Business and Trade (DBT), HMRC.                                                                       

Figure 2. Preference utilisation rates for UK imports from non-EU partners in 2021, by HS section

Vegetable products imports into the UK from non-EU partners used the largest proportion of preferential tariffs available (98.8%), with £2,937 million eligible for preferential tariffs and £2,891 million imports used a preferential tariff.                                             

HS Section	PUR
Vegetable products	98.8%
Mineral products	98.6%
Animals and animal products	98.5%
Machinery and mechanical appliances	96.4%
Prepared food and beverages	93.5%
Base metals and articles thereof	92.5%
Articles of stone, plaster, cement, asbestos	88.4%
Plastics and rubber	88.3%
Instruments - measuring, musical	88.2%
Pearls, (semi-)precious stones & metals	88.0%
Transportation equipment	87.8%
Chemical products	84.9%
Arms and ammunition	81.4%
Fats and oil	78.0%
Textiles and textile articles	77.9%
Miscellaneous manufactures	77.4%
Footwear, headgear	77.0%
Leather and hides	75.2%
Wood and wood products	70.0%

Note: paper, printed products and works of art are not included in this chart as imports of these products were not eligible for preference in 2021. HS 99 not included.     

86.6% of UK imports from non-EU partners made use of the preferential tariffs in 2021. The PUR for agricultural imports (HS01-24) from non-EU partners was 96.9% and 83.4% for non-agricultural UK imports (HS25-97).

Source: Department for Business and Trade (DBT), HMRC.                                                          

Figure 3. Total tariff eligible imports into Great Britain from EU27 partners in 2021, by HS section 

Transportation equipment made up the largest proportion of GB preference eligible imports (£28,746 million) into EU27 during this period (22.6%).

HS Section	Pref eligible imports (£ million)	Imports not eligible for preference (£ million)
Machinery and mechanical appliances	21,264	33,853
Transportation equipment	28,746	9,104
Chemical products	14,318	16,887
Prepared food and beverages	19,368	2,190
Plastics and rubber	15,797	586
Paper, printed products	0	12,014
Base metals and articles thereof	3,660	7,817
Mineral products	1,725	7,151
Vegetable products	6,251	1,512
Pearls, (semi-)precious stones & metals	431	6,197
Instruments - measuring, musical	561	4,932
Animals and animal products	4,603	648
Miscellaneous manufactures	2,501	2,472
Wood and wood products	933	3,479
Textiles and textile articles	3,482	250
Articles of stone, plaster, cement, asbestos	1,067	1,652
Footwear, headgear	877	14
Leather and hides	762	96
Fats and oil	778	59
Works of art	0	670
Arms and ammunition	62	1

Note: HS 99 not included.                                                                 

Source: Department for Business and Trade (DBT), HMRC.                                                                                  

Figure 4: preference utilisation rates for GB imports from EU27 partners in 2021, by HS section

Animals and animals products imports into GB from EU27 utilised the largest proportion of preferential tariffs available (99.1%), with £4,603 million eligible for preferential tariffs and £4,562 million imports used a preferential tariff.                                             

HS Section	PUR
Animals and animal products	99.1%
Fats and oil	98.2%
Vegetable products	97.4%
Wood and wood products	96.0%
Plastics and rubber	95.4%
Chemical products	95.3%
Mineral products	93.8%
Arms and ammunition	93.5%
Prepared food and beverages	91.5%
Transportation equipment	90.3%
Articles of stone, plaster, cement, asbestos	89.6%
Base metals and articles thereof	87.3%
Machinery and mechanical appliances	85.1%
Miscellaneous manufactures	83.0%
Textiles and textile articles	81.7%
Leather and hides	81.3%
Footwear, headgear	79.2%
Instruments - measuring, musical	64.2%
Pearls, (semi-)precious stones & metals	61.8%

Note: paper, printed products and works of art are not included in the above chart as imports of these products were not eligible for preference in 2021. HS99 not included.      

90.8% of GB imports from EU27 partners made use of the preferential tariffs in 2021. The PUR for agricultural imports (HS01-24) from EU partners was 94.0% and 89.8% for non-agricultural UK imports (HS25-97).

Source: Department for Business and Trade (DBT), HMRC.          

5.2 GB exports by HS section

The following section only covers GB exports by HS Section to EU27 partners. The same breakdown cannot be provided for UK exports to all non-EU partners as data is only available for non-EU FTA partners that exchanged the data required for this analysis^{[footnote 4]}. As a result, the release does not include a total by HS section for total non-EU exports as the release does not cover all non-EU partners where the UK has a preferential tariff. For export PURs by non-EU partner by HS chapter, see the export PUR database file.

Figure 5: total tariff eligible exports from Great Britain to EU27 partners in 2021, by HS section    

Transportation equipment made up the largest share of GB preference eligible exports to the EU27 during this period with a value of £10,620 million (20.0%).

HS Section	Preference eligible exports (£ million)	Exports not eligible for preference (£ million)
Machinery and mechanical appliances	9,999	11,084
Chemical products	7,774	11,425
Mineral products	3,647	14,995
Transportation equipment	10,620	5,378
Base metals and articles thereof	3,355	5,347
Pearls, (semi-)precious stones & metals	176	6,548
Plastics and rubber	5,219	1,219
Prepared food and beverages	3,543	2,795
Instruments - measuring, musical	866	3,985
Animals and animal products	2,324	1,147
Textiles and textile articles	2,195	528
Paper, printed products	0	2,451
Miscellaneous manufactures	919	735
Articles of stone, plaster, cement, asbestos	706	425
Vegetable products	642	367
Works of art	0	705
Fats and oil	312	129
Wood and wood products	139	206
Leather and hides	255	87
Footwear, headgear	272	65
Arms and ammunition	34	55

Note: HS99 not included.

Source: Department for Business and Trade (DBT), Eurostat.

Figure 6: Preference utilisation rates for Great Britain exports to EU27 partners in 2021, by HS section

Mineral products exports from GB into the EU27 utilised the largest proportion of preferential tariffs available (97.7%), with £3,647 million eligible for preferential tariffs and £3,564 million exports used a preferential tariff.

HS Section	PUR
Mineral products	97.7%
Animals and animal products	97.5%
Fats and oil	94.6%
Vegetable products	93.1%
Prepared food and beverages	87.1%
Chemical products	87.1%
Plastics and rubber	85.1%
Base metals and articles thereof	79.5%
Articles of stone, plaster, cement, asbestos	79.2%
Wood and wood products	79.0%
Transportation equipment	73.3%
Arms and ammunition	67.8%
Machinery and mechanical appliances	67.5%
Miscellaneous manufactures	62.6%
Instruments - measuring, musical	51.1%
Textiles and textile articles	47.7%
Leather and hides	34.8%
Pearls, (semi-)precious stones & metals	28.9%
Footwear, headgear	25.7%

Note: Paper, printed products and works of art are not included in the above chart as exports of these products were not eligible for preference in 2021. HS99 not included.    

Source: Department for Business and Trade (DBT), Eurostat.       

77.7% of the GB exports to EU27 partners made use of the preferential tariffs in 2021. The PUR for agricultural exports (HS01-24) to EU27 partners was 91.5% and 75.7% for non-agricultural GB exports (HS25-97).          

6. Contact DBT                                                

                                                             

7. Disclaimer                                                    

Whereas every effort has been made to ensure that the information in this document is accurate, the Department for Business and Trade does not accept liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, country or territory, company or other organisation mentioned.