UK government speeds up low‑value import tax reforms

The UK Treasury announced that the removal of the customs duty relief for low‑value imports (goods under £135) will now take effect in October 2028, six months earlier than the previously scheduled March 2029 deadline. The change is part of a broader tax update intended to level the playing field for high‑street retailers and to curb unfair competition from fast‑fashion e‑commerce platforms such as Shein and Temu.

Retail groups, including the British Retail Consortium, criticised the timeline as insufficient. Helen Dickinson, BRC chief executive, said: “While the Government has rightly recognised that a three‑year timeline for implementing low‑value import reforms is too long, bringing it forward by just six months does not go far enough.” ABF chief executive George Weston added that the two‑year delay is “unacceptable” and “dispirit­ing”. Retailers have also called for an interim £2.60 levy on parcels under the threshold.

The government will also consult on online marketplace liability and the collection of VAT from e‑commerce firms. Revenue from the reforms is slated for reforms to the business rates system to support investment and jobs on the high street. The UK’s move follows similar actions in the EU, which will introduce a €3 fee on low‑value parcels from July 2026, and the United States, which ended its exemption in 2025.