EU Customs Reform 2026: The end of the €150 duty-free allowance: what online retailers need to know

Since the beginning of July 2026, one of the key rules governing online trade with third countries has changed fundamentally. The EU has abolished the €150 duty-free threshold for small consignments. This primarily affects online retailers who import goods from non-EU countries. Even those who ship directly from third countries to customers in the EU must now review their processes and costing. In this article, you will find out exactly what is changing and what deadlines apply. We will also outline what you should now be bearing in mind regarding your fulfilment operations.

The EU Customs Reform 2026: What’s behind it?

The latest changes are part of a wider initiative. On 17 May 2023, the European Commission had already proposed a comprehensive package to reform EU customs legislation.^[1] From the outset, the aim was to adapt the European customs system to the rapid growth in cross-border online trade. On 26 March 2026, the European Parliament and the Council of the EU reached a political agreement on key elements of this reform.^[2]

The reform of the small consignment rules is therefore not an isolated initiative. It is the first tangible building block of a reorganisation that will span several years. The long-term aim is to establish a central EU customs platform through which imports will be recorded and monitored in a standardised manner across Europe.^[1] At the time of writing, the exact timelines for the full roll-out of this platform have not yet been finalised. For businesses, this means that the current change to small consignments is already relevant, and further adjustments are likely to follow in the coming years.

The end of the 150-euro duty-free allowance

Until now, there has been a clear limit: goods with a value of up to 150 euros could be imported into the EU duty-free. This exemption will cease to apply from 1 July 2026. The European Commission has explicitly confirmed this deadline: from this date, the current duty-free allowance for e-commerce consignments worth less than 150 euros will be abolished.^[3]

Important to note: The VAT exemption for small consignments had already been abolished in July 2021. Since then, import VAT has been payable from the very first cent. The current reform concerns the separate exemption from customs duties, which is still in place. Taken together, these two regulations mean that virtually every small consignment from a third country is now subject to government duties. This applies regardless of the value of the goods in the individual consignment.

The new flat-rate fee: 3 euros per item

The previous duty-free allowance will be replaced by a new, flat-rate customs duty. According to the Commission, a duty of 3 euros per item will be levied on consignments with a value of up to 150 euros.^[4] The condition is that the goods must be purchased online and dispatched directly to consumers. The charge is therefore calculated per item, not per parcel. If there are several items in a single consignment, the total amount may increase accordingly.

Regulation	Until 30 June 2026	Since 1 July 2026
Customs duty on parcels up to €150	None (duty-free allowance)	€3 per item
Import VAT	Payable from the very first cent (since July 2021)	Payable in full from the very first cent
Affected shipments	Small consignments from third countries	Small parcels purchased online and sent directly to consumers

At present, a number of important practical details have not yet been definitively clarified publicly. These include, in particular, the question of who is responsible for paying the €3 levy to customs in each individual case – the platform, the seller or the logistics service provider. A clue can be drawn from current practice regarding import VAT under the IOSS scheme: in many cases, large platforms handle the processing on behalf of individual sellers. However, it has not yet been officially confirmed whether a similar model will be established for the new customs levy. Until a definitive clarification is available, we recommend that you seek the latest advice on this matter from your customs service provider or tax adviser.

Why now? The background to the reform

The pressure for reform has been building for years. The number of small consignments imported into the EU from third countries has risen dramatically as a result of the boom in international marketplaces. A significant proportion of these originate from platforms such as Shein and Temu. These retailers dispatch goods directly from the Far East to end customers in Europe, usually as individual, small parcels. From the European Commission’s perspective, this development has had two key consequences. Firstly, the sheer volume of small consignments made it virtually impossible to carry out effective checks at the external borders, for example with regard to product safety or counterfeit goods. Secondly, it created a competitive disadvantage for retailers who sell their goods within the EU after having them properly cleared through customs and taxed. These retailers had to pay duties from which suppliers shipping directly from third countries had previously been exempt.

The new flat-rate levy is intended to reduce this competitive disadvantage. At the same time, it is intended to create an incentive to develop fulfilment structures more extensively within the EU, rather than sending individual parcels directly from third countries. Whether the reform actually achieves this effect will only become clear in the coming months, once reliable data on changes in ordering behaviour is available.

What this means for online retailers and their fulfilment operations

The extent to which you are affected by the reform depends largely on your fulfilment model.

You already store and dispatch goods within the EU: This reform will not affect parcels sent from an EU warehouse to EU customers. The new levy applies exclusively to parcels imported directly from a third country to consumers. Your day-to-day operations will therefore remain unchanged.

You import goods from third countries for your own EU warehouse: Here, too, the situation has hardly changed. The goods are imported into the EU via the standard customs clearance process before being forwarded to end customers, and are therefore not covered by the new small consignment rule.

You send individual parcels directly from a third country to your customers, for example in the dropshipping model: here, the new levy affects you directly. Every single consignment is now subject to the flat-rate levy. This can have a noticeable impact on your shipping costs, particularly when customers combine several items in a single order.

For retailers in the third scenario, it is now worth doing a comparison. How would your profit margin change if, instead, you imported larger quantities of goods in bulk and dispatched them to your customers via a fulfilment partner within the EU? In many cases, the elimination of the per-parcel fee more than offsets the additional storage costs. This is particularly true for products with higher order volumes and for ranges comprising many small items.

Outlook: Where is the EU’s customs reform heading?

As things stand, the changes to the duty-free allowance are just the beginning. In the long term, the European Commission aims to establish a central, digital customs platform.^[1] This platform is intended to ensure that imports are recorded in a standardised manner across the EU. For online retailers and fulfilment service providers, this is likely to lead to greater standardisation in customs clearance in the medium term. At the time of publication of this article, no specific timetable for the full roll-out of this platform had yet been finalised. We will update this article as soon as the European Commission announces binding deadlines.

In practical terms, this means that anyone who invests in a robust EU fulfilment solution now is not only positioning themselves for the current reform of small consignments, but also for the further standardisation of customs processes that is expected in the coming years.

Next steps for your business

• Review the fulfilment model: Find out whether, and if so how many, of your parcels are sent directly from third countries to end customers.
• Update the calculation: Please factor the new flat-rate charge of 3 euros per item into your pricing and margin calculations.
• Clarify the payment method: Please discuss with your customs service provider or platform partner who will actually pay the duty and how it will be reflected in your systems.
• Consider EU fulfilment as an alternative: Compare the total costs of direct shipping from third countries with a model where you import larger quantities and dispatch them via an EU warehouse.
• Staying on the ball: As certain details of the implementation have not yet been finalised, it is worth checking the Commission’s official communications regularly.

Frequently Asked Questions

When do the new rules come into force?

The €150 duty-free allowance has been abolished with effect from 1 July 2026. From that date, the new flat-rate charge may apply to affected consignments.

Does the new levy also apply to shipments within the EU?

No. The regulation applies exclusively to consignments sent directly from a non-EU country to consumers in the EU. Goods that are already held in an EU warehouse and are dispatched from there are not affected.

Exactly how much is the new levy?

For consignments with a value of up to 150 euros, which are purchased online and sent directly to consumers, a levy of 3 euros per item applies.

Does the charge apply per parcel or per item?

Per item. If a consignment contains several items, the charge may be added up accordingly.

Does this affect the VAT rules for small consignments?

No, import VAT has been payable from the very first cent since July 2021 and remains unaffected by the current reform. The current amendment relates exclusively to the separate exemption from customs duties.

Are there any exceptions for small businesses?

At present, there is no definitively confirmed information regarding any special arrangements for smaller businesses or specific product groups. We recommend clarifying this with a customs service provider on a case-by-case basis.

What, specifically, should online retailers be doing right now?

First, check which of the three fulfilment scenarios described in this article applies to your business model. Anyone who currently still sends individual parcels directly from a third country should adjust their pricing structure in the short term and, in the medium term, assess whether a fulfilment model within the EU makes more economic sense.

Conclusion

The abolition of the €150 duty-free threshold marks the end of an exemption that has benefited cross-border online trade for many years. For retailers who already store and dispatch goods within the EU, little will change in operational terms. However, those who send individual parcels directly from third countries should now adjust their calculations. You should also check whether a fulfilment model within the EU is the more cost-effective solution for your business in the long term. Furthermore, the reform of the small consignment rules is unlikely to be the final step in the EU’s customs reform. It is therefore worth keeping an eye on further developments.

Would you like to switch your fulfilment to an EU warehouse network whilst optimising customs and delivery costs? Our experts would be happy to advise you on a solution tailored to your business model.