EU council struggles to agree on the removal of the €150 IOSS threshold as part of the 2028 Customs Reforms

27 May 2026

The EU is struggling to finalise changes to its Import One Stop Shop (IOSS) system as part of the 2028 Customs Reforms, with member states divided over plans to remove the €150 threshold.

Introduced in 2021, the IOSS is an electronic portal that allows suppliers to declare and remit VAT on low-value goods (up to €150) sold to EU consumers, avoiding payment of import VAT at the EU border.

As part of wider European Commission reforms aimed at increasing duty revenue and reducing fraud through simplified and harmonised customs procedures, the EU Council is planning to extend the IOSS threshold alongside the removal of the €150 customs duty exemption. However, several countries, including Germany and Austria, have raised concerns that removing the threshold could increase fraud. They warn that overseas sellers could register under IOSS using post-box EU entities, import high-value goods VAT-free, and disappear before remitting the tax due.

As a compromise, some governments have proposed a new upper limit, potentially around €5,000. Under this approach, goods above this value would remain outside the scheme, with VAT paid at customs clearance, unless financial guarantees or additional safeguards are provided.

The European Commission has so far resisted this idea, arguing that introducing another threshold would encourage businesses to artificially split shipments to stay below the limit, thereby recreating many of the issues the reforms are intended to address.