Members of parliament voted 303 to 296 in favour of an amendment to a finance bill which curbed government tax administration powers if the British administration decides to leave the EU without explicit authorization from parliament, Sky News reported.
Treasury minister Robert Jenrick said it is the"simple truth" that the UK would leave the EU on 29 March, noting that planning for a no-deal scenario was "prudent preparation to provide our taxpayers with the certainty they deserve", adding that the only consequence of the amendment would be to make the UK "somewhat less prepared".
Twenty Conservative MPs rebelled against the government and their own party, including former cabinet ministers Michael Fallon, Justine Greening, Dominic Grieve, Ken Clarke and Oliver Letwin.
“I will be voting with [Cooper] against my own government, very much against my own will, and I will continue to do so right up until the end of March in the hope we can put paid to this disastrous proposal,” Letwin said addressing the Parliament.
The government’s defeat on the amendment was a sign of cross-party opposition to the possibility of leaving the European Union without a deal, said Labour's leader Jeremy Corbyn, noting that it should be ruled out “once and for all”. He had also called the development an “important step” towards preventing a no-deal Brexit, according to the BBC.
“It shows that there is no majority in parliament, the cabinet or the country for crashing out of the EU without an agreement. That is why we are taking every opportunity possible in parliament to prevent no deal,” Corbyn said, cited by the Guardian.
The decision, called the Cooper amendment, means that if there is either a Brexit deal, a decision to extend article 50, or a vote in the Commons specifically approving a no-deal Brexit, it would require approval from the parliament.
Government sources, cited by the Guardian, said that potential financial issues posed by the amendment would be “low down the list” in terms of difficulties Britain would face in case of a no-deal Brexit, suggesting that more emergency legislation would probably be needed in such a scenario, where the government could attempt to restore these powers.
Downing Street has also confirmed that the vote on Theresa May's Brexit deal will take place on 15 January. The UK is expected to leave the EU on 29 March this year.