Cross-border e-commerce is booming, "90% comes from China", the EU is about to cancel this import tax exemption

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EU member states agreed on November 13 to eliminate tariff exemptions for external small-value packages.

The EU finance ministers reached a consensus and decided to advance the parcel tax policy scheduled to take effect in 2028 to the first quarter of next year for trial implementation. The details are as followsThe tax-free policy for non-EU parcels under 150 euros will be cancelled. All parcels will be subject to an additional customs clearance and inspection fee of approximately 2 euros, as well as value-added tax.

The EU will work out more specific implementation details on December 12.

According to data from the European Commission, approximately 4.6 billion small-value parcels (referring to parcels with a unit price of no more than 150 euros) will enter the EU market in 2024, equivalent to 12 million small parcels per day.More than 90% of them come from China.Until now, these small packages could enter the EU duty-free. The European Commission is facing pressure from European businesses to curb the import surge more quickly.

The European Council claimed on social platforms that the current small parcel preferential treatment resulted in about 65% of inbound small parcels under-declaring their value. Non-EU companies split goods into multiple parcels for entry in order to avoid tariffs, which also raised environmental concerns.

At present, the EU's new customs data center has not yet been built, and some companies are worried about the insufficient ability of customs to implement new measures. Some analysts pointed out that the cost of affected cross-border e-commerce may rise significantly by then, and they may turn to strategies such as overseas warehouses and product differentiation.

In response, Foreign Ministry spokesperson Lin Jian responded that China hopes that the EU can adhere to the principles of market economy and provide a fair, transparent and non-discriminatory business environment for companies from all countries, including Chinese companies.

On August 29 this year, the United States implemented a new policy and suspended duty-free treatment for imported packages worth 0 and below. This means that regardless of the value of the goods and the country in which they are produced, all goods shipped into the United States are required to pay corresponding duties and taxes, and complete informal or formal import declaration procedures as required.

Small-value parcel flows to the EU have exceeded full-year levels since the removal of tariff exemptions in the United States. For example, Temu and Shein have reduced advertising expenditures in the United States and have increased investment in other markets, and Europe is one of the most critical markets.

Customs data shows that in 2024, China's low-price e-commerce exports to the EU will be US.1 billion, and exports to the United States will be US.1 billion; but from January to September this year, US.5 billion has flowed to the EU, exceeding the whole of last year, while it was only US.1 billion to the United States.

Now, Europe has announced that it will cancel the tax-free treatment for packages worth less than 150 euros starting from the first quarter of 2026. This is undoubtedly another blow to China’s cross-border e-commerce platforms and cross-border sellers.