Brussels move to end tax loophole exploited by China-linked marketplaces could also hit Shein’s planned London listing
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.
This isn’t helping their labor conditions though. It’s just helping companies like Amazon to sell the same junk at a higher price, as Amazon sellers buy the same products from Alibaba, and eliminate competition.
I hope this doesn't spread to the US as although it'll stop Temu and Shein, it'll also probably make niche goods and hobbyist parts more expensive. I really don't want to pay the Amazon tax if I can find the same thing on Aliexpress, and a duty would just shorten that gap.
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.
Last year, 2.3bn items below the duty-free €150 threshold were imported into the EU, according to a report in the Financial Times that highlighted the potential change.
Some countries impose import duties of up to 30%, he said, and having to pay that would force Shein to either completely change its business model, put up prices or take a hit on profit.
On Tuesday, Simon Roberts, the boss of Sainsbury’s and Argos, called on a new government to look at unfair taxes including business rates and import duty.
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