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European Union moves to end tax exemption for low-cost shipments

Brussels accelerates efforts to close loophole benefiting Chinese e-commerce giants.

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As the United States Postal Service suspends parcel shipments from China with new rules set to change the way small packages from China are sent to the United States, the European Union is following suit with its own crackdown on tax-free imports from Chinese retailers such as Shein and Temu.

According to the European Commission, more than 4.6 billion low-cost packages—mostly from China—entered the European Union in 2024 without paying customs duties, a loophole that has fueled explosive growth for these platforms. Now, Brussels is accelerating a regulation that would remove tax exemptions for shipments under 150 euros, citing unfair competition and consumer safety concerns.

In addition to that, Shein is under investigation for allegedly violating European competition laws, while Temu faces scrutiny over misleading discount tactics. To level the playing field, the Commission is considering a handling fee for non-European sellers to cover the costs of monitoring compliance. With both the United States and the European Union clamping down, it remains to be seen how this will impact global trade.

European Union moves to end tax exemption for low-cost shipments
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