The EU is moving forward with plans to impose customs duty on cheap goods in a shift that could hit imports from online retailers and harm a hoped-for London listing by the fast-fashion seller Shein.
The potential change comes amid growing disquiet among retailers based in mainland Europe, the UK and the US about rising competition from Chinese-linked marketplaces Shein and Temu, which exploit a loophole that excludes low-value items from import duty.
In the EU, the threshold for the levy is €150 (£127) and in the UK it is £135, enabling retailers such as Shein to ship products directly from overseas to shoppers in those markets without paying any import duty. In the UK, items valued at £39 or less also do not attract import VAT.
In the article.
But it’s not true. The threshold now is 0€, everything needs to pay vat since one year ago. Over 150€ it just can’t do the automatic ioss vat payment
This article from the Financial Times explains the problem.
In a nutshell this isn’t about VAT, it’s about “Customs Duty” which are apparently two separate things in the EU.
I’m in the United States and we’re struggling with this same issue. The flood of cheap goods being imported via TEMU / SHEIN that intentionally stay below the value required to pay import duty is large and growing problem.
It’s also bad for the environment in every way imaginable.
Ah i get it. But that tax is minimal and applies on specific hs codes. Like “additional 10% on polyester fabric shirts manufactured in that specific country”
I assumed it was applied it anyway together with the vat, it’s technically possible during the ioss declaration. Maybe it’s difficult to calculate for small stuff as especially clothing do the tour of the world, manufactured in Bangladesh, labeled in turkey, sent back to china for logistics
At least now everything is taxed at ~20% and china post seems stopped abusing the postal service by canceling their package service to Europe (source for that, a month ago I personally tried to send a package to myself from a Chinese post office, they said they don’t do that anymore, had to fit the stuff in the luggage) so now Alibaba and similar they ship a big container to Europe with combined orders and then use local shipping
How the us is doing by having the threshold so high is insane, leaving door open to abuse. It might made sense until the 80s when international trade was limited to big imports and there was no e-commerce. In my country every single package would declare a value of 799 and nobody would pay a dime lol