Europe Prepares for No-Deal Brexit Tax and Trade Confusion

The U.K.’s largest European trade partners are preparing for a no-deal Brexit scenario that would upend decades-long trade rules and surprise companies with new tax bills.

Without a deal, European Union companies trading with the U.K. will lose EU tax perks such as exemptions from withholding taxes and lower customs and value-added tax rates.

Chances of the U.K. failing to reach an agreement with the EU on the terms of cross-border trade increased dramatically last month when U.K. lawmakers voted overwhelmingly against a withdrawal agreement that took Prime Minister Theresa May’s government nearly two years to negotiate. In the weeks ...