BHETA is campaigning for a fairer UK market in which businesses selling products to UK consumers are subject to equivalent tax, product safety and regulatory responsibilities – regardless of where the seller is based or whether goods arrive through traditional freight channels or directly to consumers in small parcels.
The campaign was launched in November 2024 in response to the rapid growth of low-value goods being shipped directly to UK consumers by overseas sellers.
BHETA argued that responsible UK suppliers were increasingly competing against sellers that could benefit from duty-free imports and, in some cases, avoid the tax, product safety, environmental and compliance obligations that UK businesses are required to meet.
The campaign has subsequently achieved significant progress.
Government has now committed to abolishing the £135 customs-duty relief for low-value imports altogether, going further than BHETA's original call to reduce the threshold to below £40.
Government is also developing stronger customs, VAT and product-safety responsibilities for overseas sellers and online marketplaces.
The problem: responsible businesses should not be disadvantaged
UK suppliers make a substantial investment in complying with the rules required to sell products in Britain.
Depending on their products and activities, these responsibilities can include:
- Customs duties and VAT
- Product safety testing and certification
- Traceability and product information
- Extended Producer Responsibility and packaging obligations
- Plastic Packaging Tax
- Consumer protection
- Intellectual property requirements
- Age-verification requirements for restricted products
- UK warehousing, employment and customer-service costs
BHETA believes these are legitimate responsibilities that help protect consumers and maintain confidence in the UK market.
The problem arises when businesses meeting all these requirements find themselves competing against products sold directly to UK consumers by overseas businesses that do not face equivalent costs or effective enforcement.
The huge growth in small-parcel ecommerce has made this increasingly important.
BHETA's position is simple:
Businesses selling into the UK should play by equivalent rules, wherever they are based and however their products reach the consumer.
BHETA takes the case to Government
BHETA launched its small parcels campaign in November 2024 and wrote directly to Government calling for action.
Our original campaign asked Government to:
- Significantly reduce the £135 customs-duty de minimis threshold, initially proposing a threshold below £40; and
- Strengthen enforcement and controls on small-parcel imports, helping ensure overseas sellers meet the same standards expected of UK businesses.
BHETA also worked alongside other business organisations, including the British Independent Retailers Association, to increase the industry's collective voice.
Members were encouraged to contact their MPs and BHETA provided template letters to make it easier for businesses to participate.
Campaign progress: Government agrees to review the rules
In April 2025, the Chancellor announced a Government review of the customs treatment of low-value imports.
This represented the first major breakthrough for the campaign.
BHETA had been among the business organisations pressing Government to address the competitive advantage created by the £135 duty exemption and welcomed the decision as clear evidence that the concerns of UK suppliers and retailers were gaining Government attention.
The review was followed by a formal Government consultation on reforming the customs treatment of goods valued at £135 or less.
Major campaign milestone: Government agrees to abolish the £135 duty relief
Government subsequently announced that the existing customs-duty relief for low-value imports would be removed entirely.
This goes further than BHETA's original proposal to reduce the threshold below £40.
Once the reforms are implemented, low-value commercial imports will no longer automatically benefit from the customs-duty advantage that formed one of the central concerns behind BHETA's original campaign.
For UK suppliers competing against direct-to-consumer imports, this is a significant move towards the fairer trading environment BHETA has been advocating.
Further progress: implementation brought forward
In July 2026, Government confirmed that implementation of the new arrangements would be accelerated.
The deadline has been brought forward by six months, with the new system now due to be introduced by October 2028 at the latest.
Government has also published draft legislation to enable the changes.
While BHETA would favour the benefits being delivered as quickly as practicably possible, bringing implementation forward is another welcome indication that Government recognises the urgency of addressing the issue.
Overseas sellers and marketplaces to face greater accountability
The proposed reforms go beyond simply removing the duty exemption.
Government intends that under the new low-value import system:
- Sellers, or online marketplaces where they facilitate the sale, will be responsible for paying customs duty;
- Customs duty will increasingly be collected through systems linked to the sale rather than relying simply on intervention at the border;
- Overseas sellers and marketplaces without an established UK presence will be expected to appoint a UK-based fiscal representative, providing a UK point of accountability for customs debts;
- More detailed data will accompany low-value imports to help compliance and enforcement; and
- An additional fee will be introduced for low-value imports to contribute towards the administrative cost of handling and controlling the rapidly growing volume of small parcels.
These measures address another important principle behind BHETA's campaign: overseas sellers should not be able to access the UK consumer market without meaningful accountability for the obligations attached to doing so.
BHETA pushes the campaign further – VAT compliance
BHETA's campaign for a level playing field is not confined to customs duty.
In summer 2026, Government launched a separate consultation on extending VAT liability for online marketplaces to tackle continuing VAT non-compliance.
HMRC estimates that tens of thousands of businesses trading through online marketplaces may not be fulfilling their VAT obligations, potentially involving hundreds of millions of pounds of unpaid tax.
BHETA responded to the consultation and produced a detailed briefing to help members and other sector businesses make their voices heard.
BHETA supported the principle of greater marketplace responsibility while making an important distinction: new rules must target avoidance and non-compliance rather than imposing unnecessary additional costs and administration on responsible UK suppliers already meeting their obligations.
BHETA called for Government to:
- Tackle VAT avoidance that gives non-compliant sellers an unfair price advantage;
- Give marketplaces appropriate responsibility for compliance where they facilitate sales at scale;
- Protect responsible, VAT-compliant UK suppliers from duplicated administration;
- Introduce sensible safeguards for genuinely small businesses;
- Prevent sellers artificially restructuring their activities simply to avoid thresholds; and
- Ensure implementation is practical for businesses selling through multiple marketplaces.
READ BHETA'S VAT CONSULTATION RESPONSE
Product safety: another important part of the level playing field
BHETA has also continued to press for greater equality in product-safety obligations.
The issue is particularly important because goods entering the UK directly through small-parcel channels can be much harder for enforcement authorities to inspect than products entering through established supply chains.
In 2026, Government launched proposals for a new UK product-safety framework which explicitly recognises the growth of online selling and proposes stronger responsibilities throughout the supply chain, including online marketplaces.
Government has stated that the reforms are intended both to protect consumers and to support responsible businesses by creating a more level playing field.
BHETA has encouraged members to engage with this process and continues to argue that a UK supplier which invests in product compliance should not be undercut by an overseas seller that fails to meet equivalent standards.
From one campaign to a wider Government agenda
When BHETA launched this campaign in November 2024, its central argument was that the rapid growth of direct-to-consumer small parcels had created an uneven competitive environment.
Since then:
- Government has reviewed the £135 customs-duty exemption;
- Government has committed to abolishing the exemption entirely;
- Implementation has been accelerated to October 2028 at the latest;
- Draft legislation has been published;
- Overseas sellers and marketplaces are set to face greater customs accountability;
- Government is strengthening its approach to marketplace VAT compliance; and
- Product-safety reform is explicitly addressing online marketplaces and the need for fair competition.
These are significant developments and closely reflect the concerns BHETA has consistently raised on behalf of its members.
BHETA is one of a number of trade associations, businesses and stakeholders that have been pressing for reform, but the direction of Government policy now strongly supports the principle at the heart of BHETA's campaign:
If you sell products into the UK market, you should meet the UK's obligations – wherever you are based and however you reach the consumer.
The campaign continues
The direction of travel is very encouraging, but implementation will matter.
BHETA will continue to represent members as the detailed customs, VAT and product-safety rules are developed.
Our priorities include:
- Bringing the reforms into force as quickly as is practical;
- Ensuring overseas sellers cannot circumvent the new arrangements;
- Giving online marketplaces appropriate responsibility for sellers using their platforms;
- Improving enforcement of product-safety requirements on small-parcel imports;
- Ensuring the new system does not add unnecessary administrative costs to compliant UK businesses;
- Improving data and traceability for products entering the UK; and
- Maintaining Government focus on fair competition between UK businesses and overseas direct-to-consumer sellers.
Giving UK suppliers a stronger collective voice
This campaign demonstrates the value of collective industry representation.
Individual businesses may struggle to make their concerns heard in Whitehall. Through BHETA, the experiences of suppliers across housewares, small electricals, DIY, garden and home improvement can be combined into a stronger commercial case for change.
The Government's decision to remove the £135 customs-duty relief represents a particularly important step towards the level playing field BHETA began campaigning for in 2024.
Are unfair overseas competition, small-parcel imports or online marketplace compliance affecting your business?
BHETA wants to hear from members. Evidence from individual suppliers strengthens our representations to Government and helps ensure future policy reflects the commercial realities of our sectors.
