The plot from the bloc’s top brass will see EU negotiator Michel Barnier refuse to give way on key goals for Mrs May’s government unless she vows to remain in the customs union.
The negotiation strategy is being orchestrated by European Council chief Donald Tusk – who last week claimed the EU’s “heart” was open to Britain if it decided to reverse Brexit.
However despite his rhetoric towards the UK, the top Eurocrat faces accusations of sowing discord through Westminster in a bid to scupper the people’s decision to leave.
The plot will deny Britain the opportunity to broker any bespoke sectoral deals – blocking swathes of UK industry including the nation’s lucrative financial services from seamlessly operating within the EU.
Instead EU chiefs are expected to say the UK can walk away from the negotiating table with nothing more than a limited free trade agreement unless their demands to keep Britain under the yoke of Brussels are met.
And Mr Tusk is also believed to be plotting a “forgive and forget” deal to make remaining within the bloc seem an easier option – while also attempting to make Mrs May’s plans look as politically toxic as he can.
Senior officials in Brussels and capitals around the bloc told the Times the plan will heap political pressure on Mrs May and force her to side with rebellious MPs who back a soft Brexit, turning her back on hardline Eurosceptics in the party.
EU insiders reportedly believe she does not have enough parliamentary support to make a clean break from Brussels, and will instead be forced to side with moderate MPs.
However support for a hard Brexit is far from dwindling – with trailblazing Eurosceptic Jacob Rees-Mogg rallying scores of MPs to ensure Mrs May sticks to her negotiation red lines.
Mr Rees-Mogg, who represents more than 100 Eurosceptic back-benchers from the Tory party, said it would be “absurd” to remain in the single market and allow uncontrolled EU immigration to continue after we leave in 14 months’ time.
Voicing his support for the Prime Minister, he called for Cabinet Remainer Chancellor Philip Hammond to make amends with Mrs May and tow the line, insisting: “The Prime Minister is boss.”
He said: “We must have control of free movement of people as soon as we leave,”
“This idea that we can let them carry on coming for another two years is absolutely absurd.”
He also rejected the idea of remaining in the single market after we leave, as has been suggested by the EU and Europhiles like Mr Hammond, who favour a closer alignment.
Mr Rees-Mogg said: “Staying in the single market or an approximation to it is a bad deal because it means we still suffer from EU control but have no say in it.
“The Norway version would be the worst of everything – it would be better to stay in the EU.”
The EU 27 wants the UK to keep abiding by EU law and contributing to the budget while the EU Commission has even called for the period to be extended.
However, Mr Rees-Mogg said: “We want to ensure the implementation period is genuinely an implementation – not a transition that means we are basically still a member of the European Union.
“Mrs May has been absolutely clear, she’s always used the word implementation.
“Implementation means that we have left the European Union and are implementing the consequences.
“We want control of borders, control of our laws, control of our money, and the ability to make trade deals with the rest of the world from the day we leave.”