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Customs & Duties

On 1 July 2026, the EU abolished one of the most consequential pieces of small print in cross-border e-commerce: the €150 de minimis exemption, which for years let parcels below that value enter the EU without customs duty. In its place, small parcels now attract a flat €3 duty per item — a transitional measure that runs until 1 July 2028, when the EU's full customs reform is due to take over.

If you sell to EU customers from the UK, this affects you — though probably less than the headlines suggest, and if your products are UK-made, possibly not at all. Here's what actually changed, why the EU did it, and what to do about it.

What the €150 exemption was

Until 30 June 2026, a parcel entering the EU with a customs value of €150 or less paid no import duty. VAT was still due — that has been the case for even the cheapest parcel since 2021, usually collected at the seller's checkout through the Import One-Stop Shop (IOSS) — but the duty component simply didn't exist below the threshold. A £60 phone case, a £90 jumper, a £120 gadget: duty-free into any EU country, whoever made it and wherever it came from.

That exemption is what disappeared on 1 July.

What replaced it: the €3 flat duty

Rather than asking customs authorities to calculate product-specific duty on billions of small parcels overnight, the EU introduced a simplification. Low-value consignments — goods with an intrinsic value up to €150 — now carry a flat customs duty of €3 per item when they move through IOSS or the postal special arrangements. Three things about that are worth reading twice:

• It's per item, not per parcel. An order containing four separate products is four €3 charges, not one. For sellers of low-priced multi-item baskets, that adds up faster than it first appears.
• It's levied on the seller or platform, not the customer. Unlike the VAT your customer used to be surprised by at the door, the €3 sits on your side of the transaction — it's a cost to price in, not an on-delivery bill that triggers refused parcels.
• It's temporary. The flat fee applies until 1 July 2028. After that, under the EU's wider customs reform, product-specific duty rates are due to apply to small parcels like any other import.

For shipments above €150, nothing changed — those were never exempt, and they continue to be assessed under the normal tariff rules.

Why the EU did it

Volume, mostly. Around 4.6 billion low-value parcels entered the EU in 2024 — more than 12 million a day — with over 90% shipped from China. The de minimis rule, written for an era when a small parcel from abroad was an occasional event, had become the business model for entire platforms: split consignments below €150, ship direct to the consumer, undercut EU retailers who pay duty on their bulk imports. Add persistent findings that a large share of those parcels failed EU product-safety standards, and the political direction was set. The Council agreed the change in December 2025 and brought it in seven months later.

The UK angle: origin now matters below €150

Here's the part that matters most for UK exporters. Under the UK-EU Trade and Cooperation Agreement, goods that originate in the UK qualify for 0% tariff duty at any value — the €150 line was never relevant to them, and it still isn't. If your products are UK-made and you claim preference with a correctly worded statement on origin on your commercial invoice, standard customs treatment still gets your goods into the EU duty-free.

The sellers squarely hit by this change are UK businesses shipping goods that were made somewhere else — the reseller sending Chinese-manufactured products to EU customers in sub-€150 parcels. Those goods were duty-free under de minimis and now aren't. If that's your model, the €3 per item (or full tariff duty outside the simplification) is a new cost line that belongs in your landed cost and your EU pricing.

The practical takeaway: knowing whether your goods qualify as UK-originating has just moved from "nice to know" to a direct pricing question on every small parcel you send.

What hasn't changed

VAT works exactly as before. The €150 figure survives as the IOSS ceiling: sell B2C with goods worth up to €150 and you can collect the destination country's VAT at your checkout, so nothing is demanded at the door. Above it, your customer pays import VAT on delivery unless you ship DDP. And none of this touches the UK's own £135 rule for goods coming into the UK — that's a separate regime and it hasn't moved.

What to do now

Three things. First, work out where your products actually originate — not where you bought them, but where they were made under the TCA's rules. Second, re-run your landed costs for sub-€150 EU orders: if your goods aren't UK-originating, add the new duty; if they are, make sure your invoices carry the statement on origin so you don't pay a charge you're exempt from. Third, keep July 2028 on the calendar — the flat €3 is a bridge, and the rates on the other side of it will depend on your commodity codes. The 27-country EU comparison guide covers the per-country VAT picture that sits alongside all of this.