Liam Fox says being in an EU customs union would be 'a complete sell-out of Britain's national interests'

Cabinet minister Liam Fox will say allowing the UK to stay in a customs union with the EU after Brexit would be “a complete sell-out” of Britain’s interests.

The International Trade Secretary will use a speech to claim the move, which could be forced by a coalition of Labour and Tory rebels, would leave Britain in a worse position than now.

With the Cabinet set to meet on Tuesday to put final touches on the UK’s agreed negotiating position with the EU, Dr Fox will say any form of customs union would leave the UK as “rule takers”.

Dr Fox’s warning comes a day after Jeremy Corbyn unveiled a dramatic shift in Labour’s Brexit stance, confirming the party will back a “new and comprehensive” UK-EU customs union to ensure tariff-free trade.

Leading Tories too are backing a move to force the Prime Minister into a position where she must negotiate to keep the UK in a customs union.

Speaking in London, Dr Fox will say: “As rule takers, without any say in how the rules were made, we would be in a worse position than we are today.

“It would be a complete sell-out of Britain’s national interests.”

Remaining in the existing customs union would mean accepting EU rules on trade in goods without any say in how they are made, he will say.

It would limit the UK’s ability to reach new trade agreements with fast-growing economies and to develop new ways for poorer nations to trade their way out of poverty.

A customs union would “remove the bulk of incentives for other countries to enter into comprehensive free trade agreements with the UK”, Dr Fox will argue.

“The inevitable price of trying to negotiate with one arm tied behind our back is that we would become less attractive to potential trade partners and forfeit many of the opportunities that would otherwise be available to us.”

The minister will go on to say that the Government’s approach should not be about “how much of our current relationship we want to keep”, but what the UK needs to prosper in the future.

In a hint of his possible approach he will say future global trade will not be determined through “rigid trading mechanisms”, he will argue.

Dr Fox is the last in a series of senior Cabinet ministers to make a “Road to Brexit” speech ahead of Ms May’s own long-awaited address on Friday.

The PM is expected to spell out the detail of the plan for “ambitious managed divergence” agreed by her inner Brexit war cabinet at Chequers last week, and set to be approved by full Cabinet at a special meeting on Thursday.

The proposal, branded “pure illusion” by European Council President Donald Tusk, is understood to involve a promise to keep UK standards as high as European ones, as well as the creation of a dispute mechanism for cases where Britain wants to go its own way.

Dr Fox’s words will be aimed at Conservative backbenchers who are rallying behind an amendment to the Trade Bill put down by former minister Anna Soubry, which would force the UK to keep Britain in a customs union.

Ex-Tory attorney general Dominic Grieve has said “many” of his colleagues saw a customs union as an issue where they should be “pragmatic and not ideologically-driven”.

Meanwhile senior Tory backbencher Sarah Wollaston told BBC2’s Newsnight that those opposing a customs union did not have the numbers in parliament to win the day, adding: “The simple reality is this. There isn’t a parliamentary majority for a hard Brexit.”

Mr Corbyn’s speech yesterday, in which he threw his weight behind a customs union set the scene for possible defeat for MS May in the upcoming Commons vote on the Trade Bill.