THE WHAT? The European Union is drafting plans to impose customs duties on inexpensive goods bought from Chinese online retailers, including Temu, Shein, and AliExpress, according to a report by the Financial Times. The European Commission is set to propose removing the current €150 (US$161) threshold, under which items can be purchased duty-free, later this month.

THE DETAILS Currently, EU regulations exempt packages purchased online from non-EU countries from customs duties if their value is under €150 (US$161). In 2023, approximately two billion parcels with declared values below this threshold entered the EU, straining customs capacities. The EU has been deliberating abolishing this limit as part of a broader customs reform project proposed in May 2023, with plans to expedite its adoption to counter the influx of low-cost imports.

THE WHY? The proposed duty aims to level the playing field for EU businesses by addressing the surge of cheap imports that benefit from tax exemptions.