The EU’s new ‘Temu tax’ is simply burdening consumers without giving a helping hand to businesses, PN MEP Peter Agius warned.
Speaking on the WhosWho podcast, Dr Agius broke down why purchasing from sites like Temu and Shein has become so expensive in recent days, with customs clearance fees sometimes more costly than the products themselves
The European Commission has scrapped an exemption that allowed parcels worth less than €150 to enter the EU completely tax-free
This exemption was originally introduced to facilitate online shopping, but the rapid rise of platforms such as Temu and Shein led European Commission President Ursula von der Leyen and several member states to argue that it is no longer sustainable.
“Europe is being flooded with 12 million packages a day from the likes of Temu and Shein and the like,” Dr Agius said.
“The message from many member states is that their customs authorities are working full-time to keep up with Temu.”
While other concerns were raised about these platforms – ranging from the sale of childlike sex dolls to reports that some cheap products failed to comply with EU safety standards – the main sticking point was the growing strain they placed on customs authorities.
However, the new €3 tax isn’t being applied per delivery but per ‘category’ of item and there are several grey areas as to whether certain items fit into the same category or not.
For example, Dr Agius warned that it is even a question of interpretation whether a shirt, a polo shirt and a T-shirt fall into the same category or three different ones.
And since the platforms are legally obliged to collect these taxes from consumers and pass them on to European customs authorities, they are erring on the side of caution.
“If you want to order T-shirts from Temu but don’t want to pay more than €3 in tax, then you should buy ten T-shirts of the same type, the same brand and the same size,” he suggested.
And while this tax will certainly raise money for European customs authorities – Malta alone is estimated to earn an extra €15 million - €20 million a year – Dr Agius warned that it won’t make local businesses more competitive.
“In a recent letter to Ursula von Der Leyen, I insisted that there is a problem behind the idea of this tax because it’s just dumping it onto the consumer with no proactive measures to empower businesses.”
For example, he warned that Maltese stationeries are bogged down in costs and regulations – including eco-tax, CE compliance, VAT and rent.
“No one checks if Temu is compliant, but if a stationer sells a couple of stickers that use a product that might harm the skin, they risk getting fined. Meanwhile, he has to pay eco-tax, VAT and rent and is also expected to compete with Temu.”
“The situation is really dramatic for the guys.”
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