The European Union (EU) is dramatically accelerating its efforts to counter the flood of low-priced Chinese goods entering the market, primarily targeting e-commerce giants like Shein and Temu. Effective July 1, 2026, a flat-rate tax of €3 will be applied to small non-EU parcels, marking the end of the long-standing customs duty exemption for consignments valued under €150.

This move is strategically aimed at addressing the massive volume of imports, 91 per cent of which - totaling over 4 billion consignments in 2024 - originated from China. Roland Lescure, Economy Minister, France emphasized the urgency, noting the unfair competitive advantage these duty-free parcels have over European retailers who pay full taxes.

The tax measure had been planned as part of the Customs Union reform but was not set to apply until 2028. However, amid intense pressure led by France, the 27 member states agreed in November to implement the duty change ‘as soon as possible’ in 2026.

The challenge now is establishing a ‘simple and temporary’ taxation method until the new customs data platform is operational. Lescure advocated for a flat-rate tax over proportional taxation, arguing that a fixed fee would be a more effective deterrent against the high volume of low-value shipments. European diplomats, however, noted the difficulty of implementing such a provisional system quickly using current resources.

Beyond the €3 tax, the EU’s offensive includes the introduction of handling fees starting November 2026, proposed at €2 per parcel. This fee will help finance the development of enhanced customs controls, aiming to ensure imported goods comply with EU standards and to intercept dangerous or counterfeit products. Together, the new tax and fee are designed to level the playing field for European businesses against the rising tide of ‘made in China’ competition.