Cheap Imports Under Fire: EU Tightens the Screws on Trash Products from China
The Government of the U.S. pushes for taxation on affordable goods imported from the EU.
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The EU Commission is clamping down on cheap goods from third countries. In the near future, finance ministers will discuss this issue. Germany advocates for tariffs on affordable products from third countries within the EU.
In response to unfair competition, the German government is pressing for tariffs on inexpensive goods imported from third countries in the EU. "To guarantee fair competitive conditions and thus protect jobs, it's essential that we don't end up being the losers who pay fair wages and play by the rules," stated Finance Minister Lars Klingbeil at a meeting with his EU peers in Luxemburg.
This topic will be a hot topic at the finance ministers' meeting, where a reform of the customs union will also be tackled. Brussels seeks to tax previously duty-free, cheap goods from third countries with this revision.
Germany will make sure that discussions crystalize around "junk products" from China, inflated supply, and predatory pricing. "Such trade practices harm businesses in Germany and the EU," declared Klingbeil.
EU Agenda: Cracking Down on Cheap Imports
Close to two years ago, the EU Commission unveiled its plan to square off against unfair competition. Their ambition includes slapping tariffs on numerous goods under €150. As of now, no duty is required when the goods' value falls below €150 – with only a few exceptions such as for tobacco or perfume[1][3][6].
The reform would demand that online shopping hubs like Amazon and Etsy foot the duty bill and VAT when making a purchase. The rise of online trade has led to a surge of small, low-value package deliveries within the EU in recent years.
Recent news revealed that the commission is contemplating a €2 flat rate on such orders. Approximately 12 million packages enter the EU daily in 2024 – a dramatic increase compared to the preceding two years[1]. Platforms like Temu and Shein may be subject to this fee.
Bargain Paradise: Shopping at Temu and Shein
Temu is an online marketplace where companies offer a plethora of products. The company has operated in Germany since spring 2023, capturing attention with its budget-friendly prices and enticing discounts. Products are typically despatched directly from the manufacturer to the customer.
Shein, a fashion house rooted in China and Singapore, operates as a manufacturer, retailer, and marketplace. As a direct supplier, it swiftly adapts to fashion trends. Experts attribute Shein's low pricing to its worldwide shipping strategy and the absence of physical stores or stockpiling[2].
[1] https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:52020XC0661(01)
[2] https://ec.europa.eu/growth/single-market/e-commerce_en
[3] https://ec.europa.eu/info/business-economy-euro/customs-trade/duties-taxes/dispatches-small-consignment-reliefs-duties_en
[4] https://www.euractiv.com/section/competition-and-antitrust/news/germany-pushes-for-tariffs-on-cheap-chinese-goods-in-the-eu/
[5] https://www.understandingve.com/explainers/eu-plans-to-impose-taxes-on-cheap-imports-from-china-explained/
[6] https://www.dw.com/en/eu-imposes-tariffs-on-cheap-chinese-imports/a-59537679
- The EU Commission's policy on unfair competition includes the consideration of slapping tariffs on numerous goods under €150, adhering to the community policy they unveiled two years ago.
- Employment policies in various EU countries, such as Germany, are shifting due to industry discussions surrounding tariffs on cheap products, particularly imports from China. Financial implications and the impact on businesses are key considerations in these policy changes.
- In the realm of general-news, the tightening of EU customs union rules to tax previously duty-free, cheap goods from third countries is gaining significant attention in the business and politics sectors. This change may affect online retailers like Amazon and Etsy, as well as companies such as Temu and Shein.
