The EU will cancel the tax-free policy! Sellers are going crazy!

According to foreign media reports, the European Union plans to cancel the tax-free policy for imported goods below 150 euros (about 125 pounds) and is considering imposing handling fees on retailers.

According to reports, on February 5, in Brussels, Belgium, the European Commission "called on" the EU to launch customs reforms and propose new customs supervision rules for major e-commerce platforms such as TEMU, SHEIN and Amazon to deal with the massive influx of counterfeit, shoddy and unsafe goods from Asia into Europe.

According to a draft legislative proposal submitted in Brussels (the capital of Belgium), the reform proposal will pool customs data from 27 national customs departments and establish a new EU Central Customs Authority (EUCA). The proposal also includes abolishing the current import tariff threshold of 150 euros.

The relevant measures of this draft are summarized as follows:

The EU's current tariff policy stipulates that parcels with a value of less than 150 euros are exempt from import tariffs. This policy originally applied to mail between individuals, but is now used by a large number of e-commerce platforms, resulting in the vast majority of parcels coming from non-EU countries. In particular, in 2024 , about 4.6 billion "inspection-free, tariff-free" low-value goods (unit price less than 22 euros) will flood into the EU market, of which 91% are from China .

This number is more than double that of 2023, with many of these products sold through Shein and Temu. Shein in particular, the clothing retail e-commerce platform, sells a large number of clothing items priced at less than 10 euros per unit in the EU.

The European Commission stressed that these products not only constitute unfair competition for local EU sellers who abide by the rules, but also the transportation of large numbers of packages has a serious negative impact on the environment and climate. Therefore, the EU hopes to strengthen the supervision of online retail goods by imposing processing fees and abolishing tax-free thresholds to ensure fair competition in the market and consumer safety.

Currently, Temu and SHEIN say they have complied with EU regulations, while Amazon says it takes proactive measures to prevent unsafe or non-compliant products from being sold on its website.

It is understood that the specific time for the collection of the "package handling fee" introduced in the plan is still under discussion. Because the formal introduction of the regulations requires the approval of all 27 EU member states, it is not clear when the EU's package plan for cross-border e-commerce will finally take effect.

And if you look closely, the word "call on" is included in the content released by the European Commission, which means "call on". You know, calling on and actually implementing are two different things. Whether this draft can be passed is still hanging in the balance.

As early as May 2023, the EU proposed a similar proposal to cancel the 150 euro exemption, and it was brought up again in September last year. However, after a long deliberation, it still failed to be put into practice. This shows that the implementation of relevant EU policies often requires a long process.

Therefore, before the EU policies are actually implemented, there is no need to be overly anxious, just stay tuned.

In the EU plan, new regulations for cross-border e-commerce require that even cheap goods below 150 euros must pay tariffs. If the new regulations are really implemented, the seller's costs will increase as follows :

1. After the tax-free threshold is abolished, all goods are subject to tariffs ( tax rate is about 10%-20% ). For example, if the tax rate is 15% for clothing priced at 50 euros, the cost will increase by 7.5 euros.

2. Package handling fees have increased. A handling fee of 1-3 Euros is charged for each package . For sellers who ship 1,000 orders per day, the annual cost may increase by more than 360,000 Euros.

3. Enterprise cost calculations show that the comprehensive tax rate may increase operating costs by 12-18% (including 20% ​​VAT and commodity category tariffs); customs clearance time is expected to be extended by 3-5 working days, and the logistics delivery rate may drop by 15%; after the mandatory use of the pre-declaration system, technical compliance costs will increase by 80,000-100,000 euros per year .

For Chinese cross-border e-commerce sellers, especially small and medium-sized sellers, they may face the following challenges in the future :

Of course, for consumers, this also means that the cheap products previously provided by China will become more expensive. For example, these "ultra-low-priced" products such as summer clothes at 2.70 euros and earrings at 30 cents may not be available much in the future.

Although there are voices of support from the EU Parliament, the implementation of this policy still faces resistance from member states and uncertainty in the details of its implementation. Sellers are advised to pay close attention to the progress of the policy and be prepared for possible changes.