The timeline
| When | What changes | Effect on a €40 parcel from China |
|---|---|---|
| Before July 2021 | VAT exemption under €22, duty exemption under €150 | No VAT, no duty |
| July 2021 | VAT exemption removed; IOSS introduced for parcels under €150 | VAT charged, no duty |
| July 2026 | Duty charged on low-value parcels (flat-rate regime for e-commerce imports) | VAT plus duty on every parcel |
| By 2028 | €150 duty exemption removed entirely; customs data hub and full duty assessment | VAT plus duty at the tariff rate for the product, formal declaration |
The direction is the same as the US de minimis change: per-parcel import from China stops being duty-free, and the fixed cost of clearing each parcel starts to matter.
What it does to per-parcel dropshipping
Under the old rules a €40 product shipped from Shenzhen paid VAT and nothing else. Under the 2026 regime it pays VAT and duty; by 2028 it needs a full declaration with a tariff code. Courier handling fees for the declaration, typically €3–8 per parcel in Europe, fall on either the seller or the customer. Customers who are asked to pay at the door refuse delivery; sellers who absorb it lose the margin.
The model that replaces it
One bulk shipment into an EU warehouse, cleared once, with stock fulfilled domestically. For a brand selling into Germany, France and the Netherlands:
- Goods ship by sea or rail from China to Hamburg or Rotterdam; rail from Yiwu to Germany takes about 20–28 days.
- A single customs declaration under DDP, with import VAT handled by the forwarder's fiscal representative or deferred under your own EU VAT number.
- Stock sits in a 3PL in Germany, Poland or the Netherlands and ships to customers in 1–3 days.
- Per-unit import cost on a sea LCL shipment of 3 m³: roughly €1.20–2.00 including duty, against €8–15 per parcel the old way.
The cost of the switch is working capital: 30–60 days of stock instead of none. The benefit is a delivery time European customers will tolerate and a landed cost that stays fixed when the parcel rules change again.
VAT: the part that trips up non-EU sellers
Import VAT is due when goods enter the EU, at the rate of the country of entry. A non-EU company can either pay it at the border and reclaim it through a VAT registration, or use a fiscal representative, or import through a forwarder who handles it under DDP and invoices you. For a seller without an EU entity, the DDP route is the one that does not require a tax registration before the first shipment. Get the VAT handling agreed in writing in the quote.
What to do before 2028
- Classify your products with EU TARIC codes so duty is known before you order.
- Pick one entry country and one 3PL; splitting stock across countries from day one multiplies the admin.
- Move restocks to a monthly or bi-monthly bulk cadence by sea or rail.
- Decide on VAT handling: own registration, OSS for sales, or DDP through the forwarder.
- Keep marketplace listings (Amazon.de, bol.com) on EU stock; marketplace rules now assume local inventory.
Frequently asked
Does the EU change affect goods shipped to the UK? +
No. The UK left the EU customs union; UK import rules (the £135 threshold for VAT at point of sale) are separate. A brand selling to both needs two import setups.
Is rail from China to Europe reliable? +
Yes for Germany, Poland and the Netherlands, with door-to-door times of 20–28 days. It is priced per pallet and sits between sea and air on cost.
Do I need an EU company to import? +
No. A forwarder can act as importer under DDP and handle VAT through its fiscal representative. An EU VAT registration becomes worthwhile when your volume justifies reclaiming import VAT directly.
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Figures are indicative floor rates and typical fee ranges on our lanes as of Oct 11, 2026. Duty rates depend on your product's tariff code and declared value. This is general information, not customs or legal advice.