In December 2025, EU Member States came to the decision that, in order to level the playing field for European businesses, they were going to abolish the duty-free exemption for low-value goods imported from non-EU countries.
So, from 1st July 2026, a new €3 custom duty will be introduced per item and will apply to all eCommerce parcels valued under €150 arriving from non-EU countries.
The €3 duty is a temporary measure ahead of the 2028 EU Customs Reforms.
For UK businesses, this marks a significant departure from the ‘parcel-based’ rules we’ve grown accustomed to, as this new levy is charged per item category, not per shipment parcel.
To be extra clear, the customs duty will apply per item category (based on tariff codes) rather than per shipment. So, the charge can stack if a parcel has multiple items of different categories in it.
This means that UK businesses must rethink their pricing and shipping strategies because the €3 charge 'stacks' for every different type of product in a box, a single multi-item order could suddenly become significantly more expensive for your customer.
Importantly, the customs duty is separate from VAT, which will continue to be declared and paid via Import One-Stop Shop (IOSS) where applicable.
Currently, most UK businesses use IOSS to collect VAT at the point of sale, ensuring the customer has nothing to pay upon delivery. However, the new €3 levy specifically targets these IOSS flows, which account for roughly 93% of all eCommerce imports into the EU.
While IOSS will continue to handle your VAT, it will not automatically swallow this new customs duty.
While we are here to provide guidance and practical steps for your preparation, these changes are complex and carry significant financial implications. As such, we strongly recommend that businesses seek professional consultation or legal advice to ensure full compliance with the new EU regulations.
With that in mind, here are some tips on what you could do:
- The "Transparent" Route: You integrate the €3-per-category fee into your checkout price. This protects the customer experience but may make your products look more expensive compared to EU-based competitors.
- The "Surprise" Route: You leave the duty to be collected at the border. In this scenario, the consumer is charged directly by the courier before they can receive their parcel.
The surprise route can also be risky, as if the duty is charged directly to the consumer upon arrival, the true cost of your product is hidden at the last minute, which can lead to them simply refusing the parcel and also not trusting your business for future purchases.
Broad impact
While the EU’s primary targets are massive non-EU marketplaces, such as China and the US, the legislation is broad. Every UK business from Sheffield to Swansea that ships to EU markets will be affected.
Before July 2026, and if you haven’t done so yet, we recommend performing an audit that covers:
- Look at your most common multi-item orders
- Identify how many different traffic classifications/codes are in those orders
- Calculate the potential duty stack (e.g. it could possibly be €9 extra duty if there are 3 separate items)
It is also important to note that this €3 duty is separate from any national handling fees already introduced in countries such as Italy or Romania.
To ensure your business thrives under these new rules, consider the following:
- Unlike VAT, which can often be reclaimed, the €3 flat-rate duty seems to be typically non-refundable once the simplified declaration is made.
- Ensure your eCommerce platform can capture and transmit accurate HS Codes and Product Identifiers by the 2026 deadline.
- Because these changes involve complex tax law and shifting international regulations, we strongly recommend that businesses seek professional consultation.
In addition to the upcoming duty, mark in your calendar that a separate €2 handling fee on low-value eCommerce parcels is currently under negotiation and anticipated for October 2026; however, as this fee is distinct from the €3 duty, it has not yet been finalised.
How Wolfestone can support your EU growth
Since 2006, Wolfestone has helped British exporters innovate, communicate and scale in EU markets through tailored translation services and dedicated project management.
Our experienced team handles translation, desktop publishing and multilingual label compliance to ensure your products meet the strict regulations of the EU market.
Additionally, our team also manages full-scale localisation of your Ecommerce shop, with the clear objective of enabling your European and global customers experience a checkout process that feels local and frictionless.
Contact us today for more information, a free quote or a free translation test piece.
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