British retailers have renewed pressure on the government to accelerate plans to remove a customs duty exemption on low-value imports, arguing that the current system gives Chinese e-commerce platforms such as Shein and Temu an unfair advantage over domestic businesses. The episode indicates that concerns over Chinese trade practices are spreading beyond the EU–Beijing relationship, with Britain joining a broader international effort to reassess the impact of Chinese e-commerce platforms on domestic markets.
Retailers demand faster reform of import duty rules
The controversy centres on the United Kingdom’s £135 ($180) de minimis customs duty relief, which exempts qualifying low-value imports from customs duties, although Value Added Tax (VAT) still applies. Retailers argue that the exemption enables overseas sellers, particularly Chinese online platforms, to ship products directly from factories in China to British consumers without incurring customs duties that UK-based competitors often face on larger imports.
The UK government announced in its Autumn Budget in November 2025 that the exemption would be abolished by March 2029 at the latest. A government consultation on the implementation of the reform closed on March 6, but the Treasury has not yet published its response.
In a letter sent last month, major retailers including Primark, Marks & Spencer and Next urged the government to fast-track the reforms, contending that the current arrangements place British businesses at a competitive disadvantage. Their concerns have intensified alongside a sharp increase in low-value imports. According to HM Revenue and Customs (HMRC) data cited in the government’s consultation document, the declared trade value of such imports increased from £3.8 billion in 2023–24 to £5.9 billion in 2024–25. During the same period, import volumes roughly tripled between 2021 and 2024.
The consultation document noted that both the nature and volume of these imports have changed significantly, with many parcels now entering the country through direct-to-consumer e-commerce models associated with Chinese exporters. Retailers also point to the consequences of VAT collection reforms introduced in 2021. While those changes shifted more responsibility for VAT collection onto online marketplaces, the customs duty exemption remained intact. The period that followed saw rapid growth in cross-border parcel shipments.
Global shift towards stricter controls
The Treasury has previously described the planned reform as a significant measure intended to support British businesses while improving oversight of goods entering the country. Officials say responses to the consultation are currently being reviewed before the final policy details are announced, although no timeline has been provided for publication.
Britain’s review forms part of a broader international trend toward tightening regulations on low-value imports. The United States fully implemented the removal of its de minimis exemption for low-value shipments, including those originating from China, in 2025. The European Union, of which Britain is no longer a member following Brexit, is also moving to strengthen controls. The bloc plans to introduce a fixed customs duty of €3 ($3.50) on parcels valued below €150 ($174) from July 2026, ahead of wider reforms scheduled for 2028. France has already introduced additional measures on low-value parcels, effective from March 1.
As part of the UK review, the consultation seeks views on possible handling fees, enhanced data requirements and other measures designed to modernise border controls while balancing revenue collection, administrative costs and competitive fairness for domestic businesses.
The outcome of the review will be closely watched by retailers, e-commerce platforms and trading partners alike, as Britain reassesses how imported low-value goods are treated in an increasingly digital and globally interconnected marketplace.
