Britain will be unable to sign and negotiate trade deals without the European Union’s support after Brexit under Labour's plans to keep the UK in a customs union with the bloc.
Sir Keir Starmer, the shadow Brexit secretary, warned it was now "crunch time" for Theresa May over her approach to the customs union, and said it would be "better" to reach "bold" new trade agreements by working with the EU.
Barry Gardiner, the shadow international trade secretary, confirmed that being in a customs union with Brussels would mean the UK and EU “jointly” doing deals with third party countries.
The confirmation of Labour’s position on what it wants Britain’s trading relationship with the EU to be will infuriate Brexiteers who view the ability to strike global free trade deals as one of the main prizes of withdrawal.
It will also increase pressure on Mrs May who has ruled out Britain being in a customs union with Brussels after Brexit.
A cross-party amendment to the Trade Bill which would keep the UK in a customs union is believed to have the backing of at least 15 Tory MPs.
Both Sir Keir and Mr Gardiner signalled that Labour could back the amendment - or something similar - which raises the prospect of a potential Government defeat on the issue unless Mrs May can find a way to assuage the concerns of the Conservative rebels.
Sir Keir said Labour had had "many weeks of discussion unanimously" and had agreed to develop their policy which will be formally announced by Jeremy Corbyn, the Labour leader, on Monday.
He told BBC One's The Andrew Marr Show: "Obviously it's the only way of realistically to get tariff free access, it's really important for our manufacturing base and nobody can answer the question how you keep your commitment to no hard border in Northern Ireland without a customs union."
He continued: "The customs arrangements at the moment are hardwired into the membership treaty so I think everybody now recognises there's going to have to be a new treaty - it will do the work of the customs union.
"It's a customs union, that's what the CBI are saying now, it's what the various amendments are now all saying - there's going to have to be a new agreement, but will it do the work of the current customs union? Yes, that's the intention."
Meanwhile, Mr Gardiner spelled out Labour’s proposed post-Brexit trade policy in an interview on the Pienaar’s Politics programme on BBC Radio 5Live.
He said: “The UK and the EU jointly would be negotiating all the trading arrangements for goods because of course a customs union only deals with goods with any third parties so the tariffs and the quotas that were applied to any third party country would be the same for the UK and the EU.
“That is how a customs union works and vis-a-vis ourselves there would be a free movement of goods within the border.
“It is not undercutting, it is not a matter of the UK going out there separately from the EU and undercutting the EU, we would have to do that jointly.”
Mr Gardiner also said he believed there is a parliamentary majority in favour of keeping the UK in a customs union with the EU.
He said: “People are trying to make this into a semantic problem for the Labour Party. The real problem that the Government has is that actually it would appear that there is a majority of members of the House of Commons who actually believe that a customs union is the right option for our country and yet it is one of the Government’s red lines that they shouldn’t be there.”