EU Low-Value Parcel Rules: What Is Changing for Sellers
For years, small parcels sent into the EU from outside enjoyed light treatment at the border. That era is ending in stages. VAT has applied to every import since 2021, and from 1 July 2026 a temporary €3 customs duty applies to low-value items too. This explainer walks through what has changed, what is coming and what small online sellers outside the EU should do now. It is general information, not legal or tax advice, and the rules are still evolving, so check the European Commission's latest guidance.
Key takeaways
- Since 1 July 2021, VAT is due on all goods imported into the EU. The old €22 exemption is gone.
- From 1 July 2026, a temporary €3 customs duty applies to items in low-value parcels worth up to €150, charged per tariff category, not per parcel.
- The duty is an interim step before the EU removes the €150 customs duty exemption altogether under its customs reform.
- Accurate product descriptions and tariff codes now affect what you pay, not just whether a parcel clears.
- Sellers who adjust pricing, paperwork and checkout messages early will keep customers' experience smooth.
If you sell from the UK, the US or anywhere else outside the EU and ship small orders directly to European consumers, the border used to be fairly forgiving. Low-value parcels often arrived with nothing extra to pay. Over the past few years, the EU has steadily closed those gaps, mainly to put sellers outside the EU on a more equal footing with European shops and to cope with the huge number of small ecommerce parcels arriving every day.
This article explains the three main layers of change: VAT, the new flat customs duty and the planned wider customs reform. It also covers what you can do in practice. For the mechanics of the Import One-Stop Shop itself, see our separate IOSS explainer. Here we focus on the bigger picture and the timeline.
What "low-value" means in EU rules
In EU import rules, a low-value consignment is generally one with an intrinsic value of €150 or less. That figure matters for two reasons:
- VAT: it is the ceiling for the Import One-Stop Shop (IOSS), which lets sellers charge VAT at checkout instead of the buyer paying it on delivery.
- Customs duty: it has been the threshold below which goods were exempt from customs duty. That exemption is what the EU is now phasing out.
Above €150, normal import rules apply. Customs duty may be due depending on the product's tariff classification and origin, and VAT is handled at import outside IOSS.
Change one: VAT on every import since 2021
The first big change came on 1 July 2021. Before that date, goods worth up to €22 could enter the EU without import VAT. That exemption ended, and VAT is now due on all imports into the EU, no matter how small.
To make this workable for ecommerce, the EU introduced IOSS for business-to-consumer imports in consignments of €150 or less. With IOSS, VAT is charged at checkout at the rate of the buyer's country and declared monthly, so the parcel clears customs without the buyer paying VAT on delivery. IOSS is optional. Without it, VAT and any charges are collected from the buyer at import, often with a carrier handling fee.
Two related rules are worth knowing:
- Intermediaries: sellers established outside the EU generally must appoint an EU-established intermediary to use IOSS. A few countries with EU mutual assistance agreements are exceptions, and the UK is not one of them.
- Deemed supplier: when a marketplace facilitates the sale of low-value imported goods, the marketplace is treated as the supplier for VAT and handles it. If you sell through a marketplace, check which of your sales this covers.
Change two: the €3 customs duty from July 2026
From 1 July 2026, a temporary €3 customs duty applies to low-value parcels, meaning items worth up to €150, imported into the EU from outside. It mainly targets ecommerce.
How the duty is counted
The key detail is that the duty is charged per item according to tariff classification, not per parcel. Items that share a tariff category count once. Items in different categories count separately.
| Parcel contents | Tariff categories | Duty |
|---|---|---|
| Five T-shirts | One | €3 |
| Three T-shirts and a watch | Two | €6 |
These two examples come from how the rule has been explained publicly. If you sell bundles or mixed orders, the number of different product types in a parcel now matters.
Who declares and pays it
The seller or importer declares and pays the duty in the customs process. In practice, that often runs through your carrier, customs broker or IOSS intermediary. Ask them now how they plan to handle it and how it will appear on your bills.
How long it lasts
The European Commission describes the €3 duty as an interim measure. Sources point to it running until 1 July 2028, ahead of the full removal of the €150 duty exemption under the EU customs reform. Treat that end date as provisional and keep an eye on official updates.
Common mistake
Assuming the €3 is a one-off charge per order. Because it is counted by tariff category, a mixed parcel can cost more than you expect. Check how your best-selling bundles and typical baskets break down before you set prices or free-shipping rules.
Change three: the wider customs reform
The €3 duty is a bridge, not the destination. The EU customs reform plans to remove the €150 duty exemption fully, so low-value goods would be treated more like any other import for duty purposes. The details and timing depend on the final legislation and how it is implemented.
A separate handling fee on low-value parcels has also been discussed. At the time of writing, it is only proposed. Do not build it into your prices as a confirmed cost, but be aware it may come.
What this direction means for you is simple: the cost and paperwork of shipping small parcels into the EU from outside is unlikely to go back down. Planning for it now is easier than reacting later.
Pro tip
Set a calendar reminder to check the European Commission's customs and VAT ecommerce pages every few months. If you ship from the UK, check GOV.UK too. Rules for low-value parcels are moving faster than most areas of trade, and a quick check is cheaper than a pricing mistake.
What sellers outside the EU should do now
You do not need to rebuild your business, but a few practical steps will keep parcels moving and customers happy.
- Review your product data. Make sure each product has a clear customs description, the right HS code and its country of origin. The EU uses the 8-digit Combined Nomenclature and the 10-digit TARIC code for duty measures, so check these with your broker or carrier.
- Map your typical parcels. List your common order types and count how many tariff categories each contains. That tells you how the €3 duty will affect them.
- Talk to your carrier or intermediary. Ask how they will declare and collect the duty, how it appears on invoices and whether anything changes in the data they need from you.
- Decide who pays. Choose whether to absorb the duty, add it to prices or show it at checkout. For consumers, a surprise charge at the door is the worst outcome.
- Revisit IOSS. If you are not using IOSS yet, compare the cost of an intermediary with the cost of refused parcels and unhappy customers.
- Update your shipping and FAQ pages. Explain in plain words what EU customers will and will not pay on delivery.
Example
Imagine a UK seller of stationery who often ships notebooks, pens and stickers together to customers in Ireland and the Netherlands. The seller checks the tariff codes and finds that a typical bundle spans three categories, so it would attract three units of the €3 duty. To keep things simple, the seller rebuilds the most popular bundle around fewer product types, adjusts prices slightly and adds a line on the shipping page explaining that all import charges are included. The figures are illustrative only, but the approach works for many small shops.
Should you move stock into the EU?
Some sellers respond to these changes by holding stock inside the EU, through a fulfillment provider or a marketplace's fulfillment network. Goods then cross the border in bulk, and individual orders ship within the EU as domestic or intra-EU parcels.
Possible benefits
- No per-parcel import process for customers
- Faster delivery within Europe
- Fewer surprise charges and refused parcels
- Easier returns within the EU
Things to weigh
- VAT registration is usually required where stock is stored
- Bulk imports still involve customs duty and paperwork
- Storage and fulfillment fees, plus stock you may not sell
- Product rules, such as an EU responsible person, still apply
This is a big step for a small business. Run the numbers carefully, and talk to an adviser about VAT and customs before you commit.
Your low-value parcel checklist
- Confirm HS codes, customs descriptions and origin for every product
- Count tariff categories in your most common parcels
- Ask your carrier how the €3 duty will be declared and billed
- Decide whether to absorb, include or show the duty at checkout
- Review whether IOSS through an intermediary is right for you
- Update shipping pages and order emails for EU customers
- Check whether you have an EORI number where your shipments need one
- Schedule regular checks of the European Commission's guidance
Frequently asked questions
Does the €3 duty replace VAT?
No. VAT on imports has applied since 1 July 2021 and continues. The €3 customs duty is a separate charge on top, for items in low-value parcels from 1 July 2026.
Does the duty apply to parcels shipped within the EU?
No. It applies to low-value goods imported into the EU from outside. Parcels sent from one EU country to another are not imports.
Is there also a new handling fee?
A handling fee for low-value parcels has been proposed but, at the time of writing, is not confirmed. Check the European Commission's latest guidance before you plan for it.
Does this affect UK sellers?
Yes. Since 1 January 2021, goods moving from Great Britain to the EU are exports with customs declarations, so UK parcels to EU consumers are imports on arrival. Northern Ireland has special arrangements, so check GOV.UK if you ship from there.
Related reading
The bottom line
Low-value parcels into the EU now carry VAT on every import and, from 1 July 2026, a temporary €3 customs duty counted per tariff category. A wider reform aims to end the €150 duty exemption altogether. For small sellers outside the EU, the practical response is clear: get your product data right, understand how the duty affects your typical parcels and make sure customers know what they will pay.
These rules are still being finalized and are applied by national customs authorities. This is general information, not legal or tax advice. Check the European Commission's guidance, GOV.UK if you are a UK seller, and your carrier, or ask a customs specialist about your specific products.
