UK Advances Removal of Duty-Free Import Threshold to October 2028
The UK Treasury announced the advancement of the removal of the low-value import duty exemption to October 2028. This means that all direct mail packages will require the payment of import duties and a 20% VAT, requiring cross-border sellers to adjust their logistics strategies in advance and increase the proportion of shipments from overseas warehouses to reduce compliance costs.
What are the key facts?
- 1Effective Date: October 2028
- 2Policy Content: Removal of duty exemption for packages valued at £135 and below
- 3Context: Response to calls for fair competition from large retailers
What happened?
The UK government has decided to abolish the low-value import goods duty exemption (for items valued at £135 or below) ahead of schedule, moving the date from March 2029 to October 2028. This decision is aimed at addressing concerns raised by large retailers regarding fair competition. Once implemented, all relevant packages will incur duties and a 20% VAT, and the government will simultaneously review the VAT collection mechanisms of e-commerce platforms.
What does this mean for cross-border sellers?
With the new rules, the costs for direct mail packages will significantly increase, and sellers should reassess their logistics strategies to maintain competitiveness. Highest priority action: Accelerate the implementation of overseas warehouse models to reduce the costs and risks associated with direct shipping.