Surge in Low-Value Chinese Imports Sparks Concerns for UK Retailers
Small parcels shipped from China to the UK that bypass import taxes more than doubled in value over the past year, raising concerns among British businesses about unfair competition.
Exclusive data obtained by the BBC shows that the value of these shipments jumped from £1.3 billion in 2023-24 to nearly £3 billion in the latest financial year.
Shein and Temu Driving Growth in Cheap Imports
Industry experts say the boom is largely fueled by Chinese e-commerce giants Shein and Temu, which have rapidly grown in popularity among UK shoppers by offering low-cost clothing, homeware, electronics, and toys.
Currently, low-value imports worth £135 or less are exempt from customs duties, giving overseas sellers a competitive advantage. According to HMRC data, parcels from China accounted for 51% of all small packages shipped into the UK last year, up sharply from 35% the year before.
UK Businesses Struggling to Compete
British retailers say the surge is putting immense pressure on their operations.
Katerina Buchy, director at Sheffield-based wholesaler Ancient Wisdom, explained how difficult it has become to compete:
"Our customers aren’t ordering from us because they know they can find products cheaper online. It’s not sustainable, and the government should step in. We pay taxes and employ over 100 people, while these platforms are sending huge volumes tax-free."
Industry Warnings Over Unfair Competition
Retail analysts and trade bodies have warned that unchecked imports pose both economic and safety risks.
Andrew Opie, Director of Food & Sustainability at the British Retail Consortium (BRC), called low-value imports a “significant and growing threat” to UK high streets. He also highlighted the risk of unsafe or unregulated products entering the market due to lighter customs checks.
Retail expert Natalie Berg said Shein and Temu have transformed from “niche newcomers to retail powerhouses” in record time. However, she warned that ending the tax exemption could also impact low-income consumers who rely on affordable goods, as well as small UK businesses that use the same rule to import products.
Government Review Underway
In April, the Treasury announced a review of the low-value import exemption following pressure from major retailers including Next and Sainsbury’s.
A Treasury spokesperson confirmed that Chancellor Rachel Reeves’ review is ongoing, saying:
"We are backing Britain’s High Streets by protecting business rates relief, permanently lowering taxes for retailers, and capping corporation tax at the lowest level in the G7 to encourage investment and growth."
Shein and Temu Respond
A spokesperson for Temu said the company plans to have at least half of its UK sellers based locally by the end of the year, giving small businesses a chance to reach new customers.
Meanwhile, Shein defended its “on-demand” business model, claiming it helps reduce waste and keep prices low. The company added that all vendors must comply with strict safety standards and its internal code of conduct.
Global Crackdown on Low-Value Imports
The UK is not alone in grappling with this issue.
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The United States recently scrapped its “de minimis” exemption on Chinese imports valued at $800 (£596) or less.
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The European Union has also introduced a €2 flat fee on all small packages worth €150 (£129) or below entering the bloc.
While the value of parcels from China to the UK is rising sharply, HMRC says it is harder to measure the exact number of items, since multiple products can be included in a single customs declaration. In 2024-25, around 281,000 declarations were made for low-value goods from China — about 12% of the total.