The number of UK businesses exporting goods to the EU fell 33 percent to 18,357 in 2021, from 27,321 in 2020, according to data from HMRC.
Discussing the figures with City A.M., Michelle Dale, a senior manager at accountancy firm UHY Hacker Young, pointed out the fall is due to the extra red tape UK businesses must now comply with when exporting to the EU.
"Businesses are not getting enough support from the Government to navigate the post-Brexit trading minefield," she said.
"A lot of SMEs can't afford professional advice to cope with Brexit-related red tape. Many are likely to have decided trading with the EU is not worth the cost," Dale added.
"Fewer UK companies exporting to the EU will result in lost opportunities for growth and expansion in Europe."
In a response to the findings, a spokesperson for HMRC told City A.M.: "We have continually advised caution when comparing statistical trade data post-January 2021."
He explained that "the way HMRC collects data has changed since the UK left the EU, and comparing year-on-year data can lead to misinterpretation and factual inaccuracies, which we believe is the case here."
"In this case not only has our caution been disregarded, but the analysis only takes into account a very small subsection of overarching trade data," the spokesperson added.
The fresh HMRC figures come only weeks after the European Union confirmed it has launched the bloc's first ever challenge against the UK at the World Trade Organization over Britain's green subsidy program.
The European Commission, the EU's executive body that oversees the common trade policy for all member states, argues that criteria that were used by the British government in awarding subsidies for offshore wind power projects favoured UK-based companies and entities.
"This policy violates the WTO's core tenet that imports must be able to compete on an equal footing with domestic products and harms EU suppliers, including many SMEs, in the green energy sector," the Commission explained in a statement.
Also, it emerged last week that Brexit has spurred a rise in City firms sponsoring overseas recruits, with around 200 workers based outside of the UK being hired per week.
It comes amid a labour shortage on British soil, which has seen City law firms battle it out for the highest pay.
Visa sponsorships by UK-based financial services firms have been rising steadily for around a year, climbing from 722 in the fourth quarter of 2020 to 2,192 in the final few months of last year, The Times first reported, citing Home Office figures.
By CityAM
More Top Reads From Oilprice.com:
CityAM.com is the online presence of City A.M., London's first free daily business newspaper. Both platforms cover financial and business news as well as sport and… More