EU customs duty relief on the importation of consignments with an intrinsic value threshold of EUR 150 is likely to be removed soon. Too many parcels arrive at the EU border with a “declared” value of a few Euros not to pay VAT and customs duties.

The expected timeframe for adoption of the proposal by the Commission is late 2016, and will then go to Council.

“This exemption, which was originally a trade facilitation measure, has turned into an expensive tax subsidy in favour of imports to the disadvantage of domestic and intra-EU sales. It has been estimated that distortions resulting from this exemption cost EU business a turnover of up to EUR €4.5 billion annually. With the introduction of a single electronic registration and payment mechanism, this exemption will also no longer be needed, as VAT could be accounted for at an earlier stage than customs clearance, by exporters or carriers” says a EU representative.