The tax trick helping Shein and Temu kill UK high streets
British retailers are ramping up pressure on Prime Minister Keir Starmer’s government to accelerate the closure of a longstanding tax loophole that has fuelled the rapid rise of ultra-cheap online giants Shein and Temu.
Bloomberg reports that major companies, including Currys and Primark, along with the British Retail Consortium (BRC), are calling for the so-called de minimis exemption to be scrapped well ahead of the current March 2029 deadline.
The rule permits goods valued at £135 or less to enter the UK without incurring customs duty, a benefit heavily exploited by direct-to-consumer shippers from China.
“UK retailers cannot afford to spend another three years competing on an unfair playing field against importers not paying tariffs,” said Andrew Opie, director of food and sustainability at the BRC.
The push comes as global peers move aggressively against similar loopholes. The EU is set to impose a fixed €3 customs duty on small parcels under €150 starting in July, describing it as a “temporary solution to an urgent problem” with a permanent fix anticipated by 2028.
In the US, President Donald Trump eliminated de minimis rules last year, significantly curbing low-value shipments from China.
In responses to a recent government consultation that closed this month, Currys and Associated British Foods urged officials to align more closely with the EU’s faster timeline.
Low-value parcel exports from China to the world rose 21% in 2025 year-over-year, according to China Customs figures compiled by Trade Data Monitor. While shipments to the US dropped 30% following tariff changes, they surged elsewhere: up 178% to Singapore, 40% to Belgium, and 26% to the UK.
The BRC warns that the UK’s slower approach could leave it as an outlier compared to the US and EU, potentially redirecting even more diverted traffic to British consumers and intensifying the squeeze on domestic retailers.
