The European Union (EU) is set to introduce customs duties on inexpensive goods purchased from Chinese online retailers such as Temu, AliExpress, and Shein. This initiative, reported by the Financial Times, aims to curb the influx of low-cost and often low-quality products from China, potentially altering the landscape of European e-commerce and impacting consumers’ wallets.
Removal of the €150 Threshold and Trade Impact
Currently, goods purchased online from non-EU countries are exempt from customs duties if their value is below €150. However, the European Commission plans to propose the removal of this threshold by the end of the month. In 2023, around 2 billion parcels with declared values below €150 arrived in the EU, straining the customs capacities of member states.
The change comes amid a rapid increase in e-commerce. According to Commission data, online order imports more than doubled year-on-year, reaching over 350,000 items in April 2024 alone. The Chinese government subsidizes shipping costs, covering part of the expense of sending goods overseas.
Responses from Chinese Retailers
Shein expressed full support for customs law reform efforts, while AliExpress stated it is working with legislators to ensure compliance with EU regulations. Temu also voiced support for policy adjustments, provided they are fair and aligned with consumer interests.
Challenges in Implementing Customs Duties
Implementing the new customs duties may face obstacles. An EU official warned that gaining unanimous agreement from all member countries could be challenging, considering the increased workload for already overstretched customs employees. Since 2021, all packages sent to the EU, including those for private consumers, have been subject to VAT regardless of value, but those under €150 have been exempt from customs duties.
The European Commission’s proposal to impose customs duties on inexpensive goods from Chinese online retailers could negatively impact the EU e-commerce landscape. While the move is framed as a measure to combat the influx of cheap and poor-quality imports, it could ultimately result in higher costs for consumers. Beneath the political rhetoric, this may simply be an opportunity for the EU to increase taxation.
