Lastly, the imposition of an additional administrative fee is being considered to offset the costs associated with managing the 600 million annual parcels.
The consultation closes on March 6, 2026, and its outcome will shape the next decade of digital trade in Great Britain, with a direct impact on both global giants and the end consumer.
Image: Gemini
Published by
Rafael Sotelo
Content manager in Marketing4eCommerce
These policy shifts are likely to significantly impact major Chinese online marketplaces such as Temu and Shein, whose business models depend heavily on shipping large volumes of low-cost items across borders.
Atlantic Pacific will continue to monitor the situation and provide any necessary updates.
The UK government has announced plans to review the longstanding de minimis tax exemption for low-value imports, in a move that has been welcomed by major British retailers.
The rule currently allows goods valued at £135 or less to enter the UK without incurring customs duties; a system critics argue has been exploited by international eCommerce platforms at the expense of UK businesses.
The Latin term “de minimis” translates to “the smallest things” and has traditionally been used to justify the exemption of very low-value goods from burdensome customs procedures.
And, naturally, introduced new costs for companies exporting to that country. You can read more about the meeting and a copy of the letter here
We also briefed the media on our call for a review, explaining the reasons and background on the Low Value Imports Rule. Additionally, it proposes the collection of detailed data by item (unlike the current simplified system) and considers the option of a simplified tariff bucket system to ease the classification burden for small businesses.
Depending on the feedback Government will either take action immediately or launch a wider formal consultation. We have since spoken to both the Treasury and the Department of Business who are now preparing the consultation and indicated they are keen to hear the views of BRC and members.
Our intention is to set up a meeting with Government officials this Spring to hear more about the review and give members the opportunity to feedback their views.
The responsibility for payment will rest with the seller or the online platform facilitating the sale, who must settle their accounts with HMRC on a quarterly basis, in line with VAT payments.
The debate now centers on technical details: the consultation is analyzing whether foreign sellers should be required to appoint a tax representative physically based in the United Kingdom and assume corresponding responsibility.
At the heart of this reform lies the elimination of the customs duty exemption for so-called Low Value Imports (LVIs), defined as goods valued under 135 pounds (approximately 154 euros at current exchange rates), a measure that shall be enforced before March 2029.
According to the official documentation from the British government, this initiative is a response to the explosion of cross-border eCommerce, which has experienced a tripling in LVIs between 2021 and 2024, reaching approximately 600 million consignments each year. Local retailers have long voiced concerns about what they consider to be unfair competition, as foreign online sellers (particularly from countries like China) have leveraged this exemption to ship low-cost goods without incurring duties.
The new system aims to level the playing field, ensuring that LVIs are subject to customs duties just like other imports.
Background
The Low Value Import (or de minimis) rule allows businesses to send parcels with goods below £135 to customers in the UK without paying the tariff on that good. After the meeting we wrote to the Exchequer Secretary, a Minister in the Treasury to ask for the review.
However, as eCommerce volumes have grown and global online platforms increasingly rely on this exemption, its relevance and fairness have come under scrutiny.
Speaking at the IMF Spring Meetings in Washington DC, Chancellor Rachel Reeves signalled the government’s intention to help UK firms compete fairly by closing the loophole that international sellers have used to undercut domestic retailers.
Retailers argue that platforms like Temu and Shein leverage the exemption to ship millions of low-value parcels into the UK each day, often without meeting British environmental, ethical, or consumer safety standards, and are sold duty-free while UK retailers pay full VAT and import taxes.
Helen Dickinson, Chief Executive of the British Retail Consortium, said the review is “most welcome,” emphasising that it could prevent the UK from becoming a dumping ground for substandard goods in the wake of global trade turmoil.
Jonathan Reynolds, the UK’s Business and Trade Secretary, echoed this sentiment, promising “urgent steps to deliver quicker protections” for domestic firms.
The issue mirrors changes in the US, where the government has already lowered its de minimis threshold from $2,500 to $800 and is preparing to end the exemption altogether for China from May 2.
Retailers argue that eliminating the de minimis loophole would not only create a level playing field, but also enhance consumer protection, increase tax revenues, and support the struggling High Street.
There are also allegations of significant VAT avoidance by businesses nominally registered in the UK but not paying the tax. On the 23rd April the Chancellor published a statement agreeing to review the Low Value Imports rule. His actions entailed the implementation of structural changes in the way parcel companies worldwide managed their shipments to the United States.
This has led to increasing concerns the rule is being used to undermine UK retailers who are paying tariffs, VAT and operating well run, audited supply chains
BRC Action
On 11 April we held a call with members to discuss the issue and concluded we should ask the Government to review the activity. While foreign sellers can dispatch individual items without paying customs charges, UK companies importing goods in bulk are routinely liable for duties.
The goal? VAT is still applicable and platforms are expected to collect it and pay it direct to HMRC for businesses registered outside the UK.
There has been a large growth in the use of low value imports and as well as avoiding tariffs it has led to a rise in products not compliant with UK regulations due to reduced checks. Officials say the lengthy lead time is necessary to modernise customs infrastructure and allow for extensive consultation with affected industries.
Trade groups, however, warn that this could leave the UK vulnerable to becoming a destination for excess e-commerce stock.
The UK’s decision aligns with a broader international move away from de minimis thresholds.
Make sure you stay in touch with developments through the Trade and Logistics Community
The UK government has announced plans to eliminate the de minimis customs exemption that currently allows inexpensive goods to enter the country without incurring import duties.
The decision, revealed in the 2025 Autumn Budget, will end the duty-free treatment of parcels valued below £135 — a threshold commonly exploited by overseas online retailers shipping directly to British consumers.
Supporters of the reform argue that the existing rule disadvantages domestic businesses.
We have explained every detail thoroughly for you in this article.
In fact, this initiative was not an especially original idea. Just a few weeks ago, we explained that the European Union has decided to move forward with the elimination of its own minimis exemptions. Removing the exemption is intended to address this imbalance and create fairer conditions across multiple sectors, especially retail.
According to the government, the new regime will not be fully operational until approximately March 2029.
Curbing and regulating the massive importation of goods not exceeding €150, many of which stem from online sales originating in China, with major players such as Shein, Temu or AliExpress.
And, of course, as often happens with any form of escalation, other countries are beginning to join these initiatives.
Our media activity was boosted by a number of members who reinforced our messaging and ensured our request received maximum publicity.
Government Action
The Government reacted quickly to our call. As the UK prepares to engage with stakeholders in the coming months, the move could reshape how global eCommerce platforms operate within the British market.
As tax exemptions tighten, Metro’s end-to-end airfreight and courier solutions combine speed, cost-efficiency and full regulatory alignment for both parcel and bulk eCommerce shipments.
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Undoubtedly, one of the words of the year has been “minimis” (or “de minimis,” if you prefer).
Upon his impactful and turbulent arrival at the White House, Trump launched a forceful, inconsistent, and hesitant global trade war in which these customs duty exemptions for low-value imports played a particularly prominent role.
The latest among them is the United Kingdom.
The government of the United Kingdom, through HM Treasury and HM Revenue & Customs (HMRC), has launched a public consultation that signals the beginning of the end of an era for cross-border eCommerce in the country.