The Prime Minister is expected to announce cuts to the final total, with the final sum set to be between £7billion and £9billion. Number 10 lawyers came to the figure after concluding Britain wouldn’t be part of a planned transition period if they left with no deal.
The original agreement, penned by arch-Remainer Philip Hammond, would have seen the UK contributing to EU budgets even after leaving.
But Mr Johnson’s hardline Brexit stance could see Britain drop out without a deal on October 31, meaning there would be no transition period for costs to spiral.
Brussels had hoped to use the £39billion to fix faltering EU finances, with French President Emmanuel Macron insisting the UK should pay the full settlement.
An official from Mr Macron’s office said no deal would not remove the UK’s obligation to pay the full bill, with the leader previously saying failure to pay the settlement would amount to a sovereign debt default.
Cuts could be made to the £39billion divorce bill
Boris Johnson confirmed in a no deal the £39billion is not legally pledged
Speaking to Sky News, the Prime Mininster said the divorce bill was no longer legally pledged in a no deal scenario.
A Government source told the Daily Mail: “The PM has always said it was a huge mistake for Hammond to agree to the divorce bill before any Brexit deal had been finalised.
“If there is no deal, Brussels will need to organise a whip-round – they’ll need to plug a hole from our contribution and they’ll need billions to keep Ireland afloat.”
The Prime Minister is also expected to fire a warning shot to US President Donald Trump’s US-UK trade deal.
Although saying the deal would be a great opportunity for the UK, Mr Johnson has concerns over the impact restrictive American rules could have.
Donald Tusk said Mr Johnson does not want to be remembered as Mr No Deal
He also added any US trade deal would need to work in the interest of British businesses.
The Prime Minister claims bureaucratic obstacles stop the UK from selling British made shower trays to the US, while tariffs on cars, railway carriages and pork pies could cause problems.
He said: “We intend to seize those opportunities but they are going to require our American friends to compromise and to open up their approach because currently there are too many restrictions.”
As Brexit tensions rise, the Prime Minister has also asked Attorney General Geoffrey Cox to look into whether Parliament could be suspended.
Gardiner taunted as he defends Labour Party Brexit plans [BREAKING]
Boris and Trump set to agree September ‘free trade deal’ after talks[PICTURES]
Britain will become leader in trade liberalisation, says LIZ TRUSS[COMMENT]
The Prime Minister is meeting world leaders at the G7 summit
The PM has met with EU leaders
The suspension would be held from five weeks from 9 September, according to a leaked Government document shown to the Observer.
A Government source did not deny legal advice had been sought, adding No 10 officials ask for legal and policy advice every day.
The leaked email shows a shutdown could take place as soon as Parliament returns from summer recess on September 3.
The shutdown would last up until the last EU summit on October 17, just days before Britain would drop out without a deal.
The UK is set to leave in less than two months
At that stage, it would be too late for MPs to block Britain’s exit.
But the process could be halted if anti-Brexit campaigners succeed in getting a motion through the courts first to stop Parliament being suspended.
The Prime Minister has said securing his deal is his priority, but is running out of time to secure changes to Theresa May’s deal.
Boris Johnson has looked into how to prorogue parliament
He is using the G7 Summit in Biarritz to meet with world leaders, holding talks with Mr Macron and German Chancellor Angela Merkel.
Mr Johnson secured a small win just days before the summit as Ms Merkel agreed changes could be made if Britain found a solution to the controversial backstop.
The French leader agreed changes could be made, but that any differences would not be too dissimilar due to time constraints.