SingPost expects huge dip in low-value parcels to EU initially as customs duty takes effect

[SINGAPORE] Singapore Post (SingPost) expects to see a “big drop” in low-value parcel volume to the EU after the three euro (S$4.40) customs duty becomes effective on Jul 1, as senders assess the impact on their shipping cost.

This happened to shippers of US-bound parcels last year, as the country abruptly abolished the duty exemption for packages valued below US$800, said Lee Hon Chew, SingPost vice-president for international affairs and commercial.

But he refused to quantify the decrease then, citing commercial sensitivity, in a presentation to the media on Thursday (Jun 25).

He added that the parcel volume to the US rebounded after shippers accepted the import tax.

Changes in regulation

The EU will apply a transitional three euro customs duty per product category on shipments of up to 150 euros to its 27 member states from July 2026, with normal customs duties applicable from July 2028.

The changes are aimed at levelling the playing field for domestic retailers and ensuring that only compliant goods enter the bloc.

However, it will have an impact on shippers ranging from an individual sending a gift of high value to a large e-commerce merchant shipping commercial goods.

But personal gifts valued under 45 euros remain exempt from the new customs duties and consumption tax.

An additional customs handling fee of two euros per e-commerce import is also expected from November.

SEE ALSO

More than 40 per cent of Apac businesses plan to shift focus away from US: survey

SingPost partners Europe’s Asendia to enhance cross-border e-commerce delivery

SingPost has been getting more inquiries from shippers regarding the upcoming flat-rate customs duty to the economic bloc.

Presently, Spain, Germany and France are the key countries to which parcels from Singapore businesses are delivered, Lee added.

Almost 5.9 billion of low-value items were directly shipped from third countries to the EU without paying customs duties in 2025.

This was according to the Directorate-General for Taxation and Customs Union, which is responsible for designing, managing, and enforcing unified tax and customs policies across the bloc.

Dual-track solutions

SingPost will give customers a commercial delivered duty-paid solution and a postal delivered duty-unpaid solution.

The main difference would be that the shipper pays the duties under the first option, while the recipient foots the taxes upon delivery under the second.

Those using SingPost’s commercial duty-paid solution will need to have a corporate account with the company. It will handle the necessary duties, destination value-added tax and administrative fees on behalf of corporate customers.

This option will be made available by tapping European cross-border e-commerce and mail solutions provider Asendia.

Those sending customs duty-unpaid parcels can make use of the standard postal services at the post offices or SingPost’s web portal ezy2ship.

SingPost had created a service to the US for retail customers in 2025, designed in direct response to the scrapping of the exemption of duties on imports of up to US$800.