Tories seething at No 10 said a “number” of Brexit backers were ready to pen letters to Tory backbench boss Sir Graham Brady – formally demanding a contest for a new leader.
They told The Sun that even Tories in marginal seats believed a change was necessary – as they fear an election could take place this OCTOBER.
It followed the revelation that 60 Tory Eurosceptics have sent the PM a 30-page report detailing their opposition to the plan for a post-Brexit customs partnership with the EU.
One stormed: “No 10 should have seen this coming. We’ve been into see Gavin Barwell, people have been in to see Theresa May in the last 24, 48 hours and she just sits there and doesn’t say anything.
“She’s like a corpse, all the blood has drained out of her. If they do this people are going to start putting in more letters to Graham Brady.”
Today a meeting of the PM’s 11-strong “Brexit war cabinet” is due to choose between a hybrid customs model that would see Britain collect tariffs on behalf of the EU, and the Brexiteers’ preferred looser, technology-based arrangement.
Downing Street today hinted that a fudge could be on the cards as Mrs May's spokesman said, "There are a number of options on ways to proceed."
The so-called customs partnership would be favoured in Brussels – but many Tories fear it would see the UK become a virtual vassal of Europe.
The pro-Brexit European Research Group, headed by Jacob Rees-Mogg has sent a 30-page report to the PM outlining its opposition.
The document says a partnership would fail to give the “clean break” the public voted for – and suggests it could end up being a bureaucratic nightmare which deters global businesses from operating in the UK.
Ex-minister David Jones last night issued a veiled threat to Mrs May – suggesting the hardline Brexit supporters could bring her down over the issue.
He told the BBC's Newsnight: "Certainly, there would be a lot of very disappointed Brexiteers if we were to end up in a customs partnership.
"The Prime Minister's calculations have got to include exactly what reaction there would be from the parliamentary party and the wider Conservative party if we were to enter into that sort of relationship."
This morning Mr Rees-Mogg added: "This customs partnership is one of those clever ideas that sounded plausible when first looked at and when the detail is examined turns out to be deeply unsatisfactory, flawed and not get us out of the European Union, which is what people voted for.
"This customs partnership is the single market by another name."
But he insisted he is not threatening to bring down the PM, joking: "I'm neither John Wayne nor James Stewart."
Labour said today: "This is yet further evidence that Theresa May is being held hostage by the extreme Brexiteers in her own party."
Mrs May’s Brexit Cabinet is split. She and Philip Hammond think her plan is the only way to solve the Irish border issue.
Opposing them are key Brexiteers David Davis, Michael Gove, Boris Johnson and Liam Fox, who brand the idea “cretinous” and unworkable.
Today Housing Minister Dominic Raab suggested the looser arrangement, nicknamed "max fac", was more likely to prevail in the Cabinet.
He told the BBC: "At the moment, the way I read it is that those in favour of max fac are winning the argument."
Customs confusion: Options for post-Brexit trade explained
ONE of the key planks of the European Union is the customs union which all member countries – currently including the UK – must belong to.
It means there are no tariffs on goods going between EU states, and they all enforce the same standards for goods imported from outside Europe.
Some pro-EU politicians want Britain to stay in the customs union after Brexit – but that has been ruled out by Theresa May, because it would stop us striking any new trade deals with the rest of the world.
Last year, the PM set out two possible paths for the future customs relationship between Britain and Europe.
One option is the "customs partnership" – which would mirror many aspects of the existing customs union.
It would see the UK collect tariffs on behalf of the EU for any goods which enter Britain on their way to the continent.
The advantage of that would be no border checks would be needed between the UK and EU, particularly on the key Irish border, but Brexiteers worry it would tie us too closely to Europe.
The alternative is known as "maximum facilitation" – a hi-tech arrangement where automated systems check goods as they flow across borders in a way which helps business trade freely.
But EU bosses have cast doubt on whether the right technology exists to make that solution work.
While the row may seem technical, many Brexit backers regard it as crucial for the UK to take total control of our trade and customs arrangements, or risk making our EU departure pointless.
Theresa May faces a major challenge finding a solution which is acceptable for both hardline Eurosceptics and the pro-EU Tory rebels.
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