The principle has been agreed, but the practical details have yet to be worked out. From July 1, a three-euro tax will be applied to small non-EU parcels entering the European Union, marking the end of the tax exemption for parcels under 150 euros, in a bid to rein in Shein and Temu.

Some 4.6 billion consignments worth less than 150 euros entered the European market in 2024, at a rate of more than 145 every second. Of this total, 91% came from China. A month ago, EU finance ministers approved scrapping, from next year, the duty-free status enjoyed by these parcels.

While this measure is intended to apply to parcels from all countries outside the EU, it is primarily aimed at stemming the flood of low-priced Chinese products into Europe, which often fail to comply with European standards, and are purchased on Asian platforms such as Shein, Temu, or AliExpress.

This influx of imported parcels with no customs duty has increasingly been denounced by European producers and retailers as a form of unfair competition.

Moreover, the volume of parcels arriving at European airports and ports is so great that customs officers are frequently unable to check whether they comply. In these circumstances, it is difficult to intercept dangerous or counterfeit products before they reach consumers.

“Four years ago, there were one billion parcels arriving from China. Today, it’s more than four billion,” noted French Economy Minister Roland Lescure. “Today, these parcels represent unfair competition for city-centre businesses which pay taxes, so it’s essential to act and act fast, otherwise we will act too late,” he told AFP.

A Herculean task

France, in the midst of a stand-off with Chinese e-commerce giant Shein following the scandal over the sale of childlike sex dolls and Category A weapons, has led this battle in Brussels to scrap the exemption from customs duties on these low-value shipments.

The measure had in fact already been planned as part of the reform of the Customs Union (the European customs system), but it is not due to apply until 2028. In November, the 27 member states agreed to implement it “as soon as possible” in 2026.

But that means finding a “simple and temporary” solution for taxing these billions of parcels, until the customs data platform provided for in the reform, which should greatly facilitate the collection of customs duties, becomes operational.

According to some members of parliament, applying the usual customs duties to small parcels from 2026 onwards- with rates varying according to product category or sub-category and the country of import- would be a Herculean task, risking clogging up already overburdened customs services even further.

Roland Lescure made it clear on Thursday that he would defend “a flat-rate tax, because we want the measures taken in Europe to have an impact,” rather than “proportional taxation,” which he believes would not be a sufficient deterrent.

A first step

However, setting up a transitional system “is not easy, because we have to do it with our existing resources,” said a European diplomat, who on Thursday declined to give an exact date for the entry into force of the provisional system.

The taxation of small parcels is just the first step in the EU’s offensive against the avalanche of Chinese products entering its territory: from November 2026, it is due to be accompanied by the introduction of handling fees on these same parcels valued at less than 150 euros. In May, Brussels proposed setting them at two euros per parcel.

This sum will help finance the development of controls and, according to the EU, together with the collection of customs duties, will help level the playing field between European products and competition “made in China.”

FashionNetwork.com with AFP