Labour has denied suggestions that Jeremy Corbyn told the European Union’s chief Brexit negotiator he was open to remaining in the existing customs union after Britain’s withdrawal from the bloc.

The party’s policy has been to remain open to a form of customs union, but to leave the existing EU version, which allows tariff-free trade in goods across member states’ borders.

The Government has ruled out remaining in any form of customs union, instead pursuing a customs partnership or arrangement in an attempt to maintain frictionless trade.

The Telegraph reported details of an EU memo of a meeting between Mr Corbyn and Mr Barnier earlier this week, drawn up after a debrief between the chief negotiator and ambassadors from the other 27 member states.

According to the note, the Labour leader said he was open to remaining in the customs union, the newspaper reported.

But a spokesman for the Labour leader said: “Jeremy did not say he was open to staying in the customs union. He said that a customs union was a viable end point.

“We have been clear all the way through that you can’t be in the customs union if you are not in the EU.”

Eloise Todd, chief executive of the anti-Brexit Best for Britain campaign, said: “Jeremy Corbyn needs to keep all options open including staying in the EU.

“If Labour keep defining themselves by being two degrees different from the Tories, they haven’t understood the calamity of Brexit.

“The Japanese ambassador said today in Downing Street ‘no private companies will invest if they can’t make a profit’ – starkest warning yet that jobs are on the line up and down the country.

“May also needs to define her Brexit. The time for fudging positions for both parties is over.”