Independent retailers are putting pressure on the government to scrap the de minimis import loophole as new figures reveal that cheap imports worth almost £6bn entered Britain last year tax-free.
Cheap goods from China are flooding the UK thanks to a loophole that excludes many imports from tariffs. Under de minimis rules, any package worth less than £135 that is imported into the UK is excluded from paying tariffs. Companies like Shein and Temu have capitalised on this, leading to a big increase in the number of cheap goods being imported into the UK in the past year.
The independent retail association Bira has condemned the government's inaction over the de minimis import loophole, after a Sky News investigation revealed that £5.9 billion worth of cheap imports came into Britain last year without having to pay customs duties. Bira reports that this is having a detrimental effect on independent retailers as well as manufacturers across the UK.
According to HMRC data released to Sky News following a Freedom of Information request, the total declared trade value of de minimis imports into the UK in the last fiscal year (2024/25) was £5.9bn. representing a 53% increase on the previous year (£3.9bn).
“The figures are shocking but do not surprise the independent retail sector as we have been raising concerns for years. This is basically £5.9 billion taken from the retail sector and the UK economy, and the figure will be much higher if nothing is done.”Andrew Goodacre, Bira ceo.
Bira, which works with 6,000 independent retailers across Britain, argues that an illustrative 20% tariff could raise more than £1 billion for the Treasury.
USA and EU to scrap their de minimis threshold
President Trump has announced that the USA will end its de minimis arrangement at the end of August. The EU has also announced plans to scrap its de minimis threshold. Chanceller of the exchequer Rachel Reeves promised to review UK rules in April this year but has yet to make any announcements.
“As well as a missed duty opportunity, these imports are often evading many millions of VAT liabilities,” said Bira’s Andrew Goodacre, “Aside from the loss of high street sales, we also have significant concerns about the safety of the products coming into the country. Many of them do not comply with our standards and are downright dangerous. We also do not accept the impact on poorer families because the UK high street offers fantastic value to all shoppers, and the products are safe.”
He added: “We have seen the USA remove this loophole. The EU is also planning to close it. After an announcement to review in April by the chancellor, we are frustrated at the lack of action on this, especially from a government seemingly short of money.”
Written by Rachel Miller.