€150 Free Ride Ends: EU Cracks Down on Cheap Chinese Online Goods

The European Union is making moves to introduce customs duties on inexpensive goods from Chinese online stores such as Temu, Shein, and AliExpress. This new plan could significantly impact imports from these popular e-commerce platforms.

EU duty AliExpress
EU duty AliExpress

The shift comes in response to growing concerns from retailers in mainland Europe, the UK, and the US about the rising competition from Chinese-linked marketplaces. These retailers take advantage of a loophole that exempts low-value items from import duty. Currently, the EU’s threshold for this exemption is €150 (£127), while the UK’s is £135. Additionally, in the UK, items valued at £39 or less are also exempt from import VAT.

Chinese businesses benefit from subsidized postage costs, making it more affordable to ship cheap goods by air to overseas shoppers.

A European Commission spokesperson stated: “In May last year we put on the table customs reforms for a simple, smarter, and safer customs union. What we have proposed now is that there is no exemption anymore for packages valued below €150.”

The proposal must first be discussed and accepted by the European Parliament, which will reconvene later this month.

A Boon for Chinese Retailers, a Thorn in Europe’s Side

According to a report in the Financial Times, 2.3 billion items below the duty-free €150 threshold were imported into the EU last year. Imports from online retailers have more than doubled year on year, reaching over 350,000 items in April. This potential change could have significant implications for consumers and retailers alike.

Subsidies and Unfair Competition

European retailers argue that Chinese online giants benefit from unfair advantages. Subsidized postage costs in China make it significantly cheaper for them to ship goods by air directly to consumers. This allows them to undercut prices on a wide range of products, making it difficult for European businesses to compete.

A Level Playing Field or a Price Hike for Consumers?

The EU’s proposed e-commerce reform, which needs the green light from the European Parliament, aims to level the playing field. By eliminating the €150 exemption, import duties would be applied to all goods entering the EU, regardless of origin or value. This could have a significant impact on the final price consumers pay for goods purchased from these online stores.

The Future of Online Shopping in Europe

While the full ramifications remain to be seen, consumers can likely expect price increases on many goods purchased from Chinese online retailers. This could potentially lead to a shift in consumer behavior, with shoppers turning more towards local retailers or those offering competitive prices despite the new import duties.

Beyond the Price Tag: A Broader Conversation

The EU’s proposed reform is about more than just price tags. It raises questions about fair competition, consumer choice, and the future of the retail landscape in Europe. Will established European retailers regain their footing? Will Chinese online giants adapt their business models? How will consumers navigate the new landscape? Only time will tell, but one thing is certain: the days of ultra-cheap online shopping from China for European consumers are likely numbered. The €150 free ride is ending, and a new chapter in European e-commerce is about to begin.

For goods that are located directly at AliExpress warehouses located in Europe, buyers do not need to pay customs duties. Delivery of goods is carried out quickly and without additional costs!

To make profitable purchases, follow the sales on AliExpress in 2024

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