BRC says government taking too long over changes to low value imports

HM Treasury today set out tax and customs reforms to “make the system fairer, simpler and digital first” and vowed to “back the high street” by “bringing forward changes to low value imports by six months” in a move it said would target “cheap imports and put Britain’s high streets first”.

The government said it would now scrap the customs duty relief on low-value imports valued at under £135 by October 2028 – six months ahead of the original target set out in the Budget 2025.

It also promised to review how VAT is collected by businesses trading through online marketplaces to prevent “high street businesses [being] frequently undercut by online-only sellers who dodge their tax obligations”.

The government said it is also opening a consultation on “how the current online marketplace rules can be extended to ensure that all businesses comply with UK VAT rules”. Revenues raised from this will “go towards improvements to the business rates for pubs, restaurants, hotels and other businesses”.

Exchequer secretary to the Treasury, Dan Tomlinson, said: “This action tackles the unfair competition and dodgy businesses that are doing real damage to our high streets.

“And by making sure that tax is paid when it’s owed, we can raise revenue to put back into improvements to the business rates system for pubs, restaurants, hotels and other high street businesses.”

British retail consortium chief executive Helen Dickinson said: “While the government has rightly recognised that a three-year timeline for implementing low-value import reforms is too long, bringing it forward by just six months does not go far enough. UK retailers cannot afford to compete on an unfair playing field against importers not paying tariffs. While we recognise the practical challenges involved, we are keen to work with the government to explore solutions that could enable the changes to be introduced sooner.

“We support action to ensure all businesses selling in the UK compete fairly. There is clear evidence that some unscrupulous overseas sellers are exploiting loopholes to avoid paying the VAT they owe, undercutting responsible businesses that play by the rules.

“As the government consults on how to tackle this, any reforms must drive compliance, protect consumers and avoid adding unnecessary burdens for legitimate sellers and marketplaces.

“Retail and hospitality continue to shoulder a disproportionate share of business rates. Measures to reduce this burden will support investment, protect jobs on the high street and be strongly welcomed by the industry.”