PM 'will not backtrack' on leaving customs union

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She said: "I think anybody who has looked into this issue over the past year or so has seen that it is quite clear that there is no other place that we can go than to remain in a customs union with the European Union - nothing else makes sense".

British Prime Minister Theresa May said on Monday her government was sticking to its proposals to ease trade with the European Union after Brexit, rejecting suggestions that plans to quit its customs union were again dividing her party.

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Downing Street sources have said the Prime Minister will remain committed to leaving the customs union - despite a significant defeat in the House of Lords over the issue and rumours that her position may be softening.

Theresa May's government faced their first defeat on the EU Withdrawal Bill in the House of Lords last week when peers voted in favour staying in the customs union.

Justice Secretary David Gauke, appearing on BBC's The Andrew Marr Show, insisted the Government needs to make the case to MPs for leaving the customs union as part of Brexit.

Parliament is set to hold a non-binding vote on the customs union on Thursday.

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Health and Social Care Secretary Jeremy Hunt also said that PM's position on the customs union had been consistent.

"But the Prime Minister has been totally clear right from the outset".

Any customs union makes it effectively impossible to negotiate free trade deals with other countries - one of the government's key ambitions and a central justification for leaving the EU. At least 10 Conservative backbenchers have signed an amendment to the trade and customs bill supporting continued membership.

The former cabinet minister Nicky Morgan, who chairs the Treasury committee, said party rebels should be careful what they wished for.

Although some MPs have questioned the point of Thursday's debate, Mrs Morgan said the views of businesses and constituents anxious about the impact of Brexit on their livelihoods ought to be discussed in Parliament.

"The majority of the party would not entertain a leadership contest at the moment and those who want to. should think very carefully if they really want to intervene in the negotiations in the way a leadership contest would".

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