INDUSTRY COMMENT: BHETA
BHETA LOBBIES TO LEVEL PLAYING FIELD FOR UK PRODUCERS
In the last five years, there has been a sharp rise in the volume of products sold directly to consumers in the UK from overseas producers. The inability of the Border Force to check most of these small parcels, has led to huge difficulties for UK producers who are unable to compete with unscrupulous producers who bypass all, or part, of UK legislation, creating an uneven playing field, and a dangerous environment for UK consumers. Viewpoint from Will Jones, Chief Operating Officer of BHETA.
including duties, VAT, plastic packaging tax, extended producer responsibility tax, age verification checks, safety certification and trademarking.
U An estimated 100 million small
parcel shipments arrived in the UK from overseas sellers in 2023, due to the rise of the internet and the rise of shopping giants like Temu, Shein, Amazon and eBay. BHETA is calling for the UK Government to reduce the ‘De Minimis’ threshold for duty of £135 significantly (the De Minimis threshold refers to the value below which goods can be imported into a country without incurring customs duties). BHETA
K producers and importers must comply with increasingly onerous standards, taxes and regulations
legitimate companies, who face unfair competition from sellers of ‘knock-off’ products. The current market situation has also created an extremely advantageous position for unscrupulous overseas producers. This is leading to significant economic harm for UK producers and their employed staff as they grapple with standards, taxes, and regulations to sell products in the UK including duties, VAT, plastic packaging tax, extended producer responsibility tax, age verification checks, safety certification, and trademarking. All perfectly legitimate, but especially challenging when competitors from overseas do not have to comply.
calculates that an
estimated annual £1 billion in lost VAT (misdeclarations, understating the value of goods and seller non- compliance) and custom duty related to ‘small parcels’. Not only does this represent a significant contribution to national liquidity or otherwise, but the nature of the goods involved, over 98% of fake iPhone chargers purchased via this route would not meet safety standards, for example, also threatens consumer safety and consumer rights. In addition, there are associated problems such as adverse impact on environmental sustainability, intellectual property violation and economic harm to UK producers to consider.
Consumer safety threat Not only does this represent a huge loss of legitimate revenue for Government, but it also presents a considerable threat to consumer safety and consumer rights. Consumer safety risks emanate from faulty goods (particularly in sectors like electronics or children’s toys). Counterfeit products often
18 DIY WEEK OCTOBER 2024
do not meet UK safety standards, which may lead to electrical hazards, toxic materials, or mechanical failures, with an excellent example being the recent spate of e-bikes catching fire. Bladed articles
arrive in the UK in small parcels undermining the Home Office and Police’s attempts to reduce knife crime. Quite apart from the issue of safety, financial losses arise from UK consumers receiving faulty or counterfeit goods with no way to recover their money.
The sheer volume of ‘dodgy’ goods arriving in the UK via the small parcels route has seen UK Border Control and Trading Standards overwhelmed. As a result, most of the small parcels enter the country with minimal or no checks. Reports suggest that customs only manage to physically check around 3-5% of total shipments, with the rest being subjected to automated or random checks.
This has led to a reliance on technology and data-sharing initiatives to target high-risk parcels, leaving lower-risk items under minimal scrutiny. There are other negative implications for UK PLC arising from the current status quo. An influx of low-cost, poor-quality products contributes to a throwaway culture, with many faulty goods discarded shortly after purchase and ending up in landfill. The increased volume of small packets disproportionately adds to carbon emissions due to transportation. Counterfeit goods also undermine intellectual property (IP) rights, which damage brand reputations and discourage innovation by
The BHETA campaign With issues as big and wide- ranging as these, the BHETA small parcels campaign is advocating that firstly, the UK Government lowers the ‘De Minimis’ threshold for duty to below £40 matching many countries including China 0, Hong Kong 0, Iceland 0, South Africa 0, Switzerland CHF5, Brazil 0 and Japan £50. Secondly, the UK Government should make significant investments in the UK Border Force to facilitate comprehensive checks on imported small parcels. This should be financed by targeting the estimated £1.5 billion per year of lost tax revenue from overseas producers.
It goes without saying that there is a need for a competitive market that benefits consumers. However, the ‘small parcels’ challenge is undermining the market and creating a potentially dangerous and damaging environment that needs to be addressed.
For more information on BHETA lobbying and legislative advice contact BHETA Member Services on 0121 237 1130 or via
www.bheta.co.uk.
www.diyweek.net
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