The European Parliament has made some progress on its proposal to simplify VAT rules for e-commerce imports. He wants to remove the threshold of 150 euros for import duties. Negotiations are still ongoing, but it has now been decided that the proposed changes will come into effect by March 2028.
It was already known that the European Commission wanted to impose import duties on goods up to 150 euros. The proposal was first published in May last year. Since then, the process of its adoption by the European Council has begun.
Exception for orders under 150 euros
When importing a product from outside the European Union, for example by purchasing from an American or Chinese online retailer, you are required to pay import duty. However, orders up to 150 euros are currently exempt from this obligation.
In practice, many sellers on AliExpress and Temu use this. Due to the low prices of the products, they do not have to pay import duties. As a result, their hundreds of thousands of packages are clogging up the air freight market.
An understatement
According to a study by the European Parliamentary Research Service, the current threshold motivates traders to underprice their goods. They falsely value their goods below the threshold, leading to lower VAT charges and avoiding duty.
Removing the threshold will also reduce the administrative burden on businesses
Removing the €150 threshold would mean that all imported goods would have to go through the EU’s IOSS (Import Single Point). This will lead to lower compliance costs. In addition, it reduces the administrative burden for businesses in the EU. This will make it easier for online shops in the EU to sell imported goods to the EU.
Negotiations are underway in the European Council. The European Parliament has already voted in favor. The changes should come into force from 1 March 2028.