Not always — but in 2026 far more often than it used to be. Whether tax is due comes down to four things: the duty-free threshold of the country you are shipping to, whether that threshold also waives VAT or GST, what the goods are, and who is named as the importer. The United States removed its USD 800 allowance and the European Union removed its EUR 150 one, so the old answer (“small parcels are free”) is no longer safe anywhere.
Answer these in order and you will know before you order, not three weeks later when a carrier sends a bill.
These are the destinations I ship to most. Treat every figure as current as of publication and subject to change — this is the area of trade rules that has moved fastest in the last two years.
| Destination | Customs duty threshold | VAT / GST below that line | What changed recently |
|---|---|---|---|
| United States | None for goods of China or Hong Kong origin; effectively none for any origin since 2025 | No federal VAT; duty and fees are charged from the first dollar | USD 800 allowance suspended for China and Hong Kong from May 2025, then for all origins from August 2025; an indefinite suspension rule took effect June 2026 |
| European Union | EUR 150 exemption abolished from July 2026; a temporary flat duty of EUR 3 per item applies instead | VAT is due from the first euro, normally collected through the IOSS scheme at checkout | Low-value duty relief removed as part of the EU customs reform; the flat duty runs until the new customs data hub is due to take over |
| United Kingdom | GBP 135 on the goods-only value | Import VAT at 20% is still due; on consumer orders it is usually charged at checkout | The GBP 135 relief has been under review, with removal announced but not in force yet |
| Australia | AUD 1,000 customs value | GST at 10% applies from the first dollar on consumer sales, collected by the seller or marketplace at the point of sale | Unchanged so far, and now the most generous major threshold left |
| Canada | About CAD 20 by post; roughly CAD 40 for tax and CAD 150 for duty by courier under the North American trade agreement | GST at 5% plus provincial tax above the line | Low thresholds mean most parcels are taxable |
| Japan | Taxable value of JPY 10,000 or less for personal imports | Consumption tax at 10% above the line | Personal imports benefit from a simplified valuation method |
| South Korea | About USD 150 including freight, for personal use | VAT at 10% above the line | Threshold is measured including shipping |
This is where nearly every wrong budget comes from. A “duty-free threshold” is a rule about customs duty. VAT, GST or consumption tax is a separate tax with separate rules, and in most countries it is charged from the first unit of currency, not from the threshold.
So the honest reading of “under the threshold” is: you may owe no customs duty, but you have probably already paid the consumption tax — it was in the price at checkout and you did not notice it.
Nearly every country measures the value of the whole shipment, not of each product inside it. Four cartons of AUD 400 sent together are one AUD 1,600 consignment. Three necklaces of AUD 750 in one parcel are a single AUD 2,250 import, not three small ones.
Two consequences:
Two shipping terms decide whether you get a bill three weeks later.
| Term | Meaning | What it feels like as a buyer |
|---|---|---|
| Delivered duty paid (DDP) | The seller or agent handles the entry and pays the duty and tax | One price, nothing to pay on arrival, no paperwork |
| Delivered duty unpaid (DDU) | You are the importer of record and settle the duty and tax on arrival | The carrier contacts you for payment plus a clearance fee before release |
If you are importing stock for resale, being the importer of record is usually what you want: it is what lets you recover the VAT or GST and claim a free trade agreement rate. If you are buying a one-off personal parcel, DDP is usually the calmer option.
Two parcels of the same goods, shipped to two different places, to show how much the destination matters. Arithmetic is illustrative; your own rate comes from the tariff.
| Line | United States (China origin) | Australia (consumer order) |
|---|---|---|
| Goods value | USD 120 | AUD 180 (about USD 120) |
| Under the old threshold? | Yes, before 2025 | Yes |
| Customs duty now | Due from the first dollar, at the rate for the commodity code, plus any additional measures that apply | Normally none under AUD 1,000 |
| Consumption tax | No federal VAT | GST at 10%, usually charged by the seller at checkout |
| Formal entry needed? | Yes, informal or formal entry | No, a self-assessed clearance covers it |
| Fees | Processing fee plus the carrier’s clearance charge | Normally no processing charge below AUD 1,000 |
The same box, the same week: one destination needs a customs entry and pays duty, the other clears with nothing to pay at the border. That is why the country question comes first.
| Mistake | Why it costs you |
|---|---|
| Assuming the old USD 800 or EUR 150 rules still apply | Both were removed; the parcel now needs an entry and pays duty |
| Reading “duty free” as “tax free” | VAT or GST is usually due from the first unit of currency, and often already collected at checkout |
| Measuring the threshold per item | It is measured on the whole consignment |
| Splitting shipments to dodge the threshold | Extra freight usually costs more than the charge avoided, and it can look like evasion |
| Asking the seller to declare a low value or mark it as a gift | Under-declaration and false gift labelling are offences, with penalties and seizure risk, and it can void insurance |
| Ignoring the carrier clearance fee | On a cheap parcel it can be the biggest single line |
| Forgetting excise and restricted goods | Taxed or seized at any value, regardless of thresholds |
Very few, and the number is shrinking. A duty-free threshold usually waives customs duty only, while VAT or GST is still charged from the first unit of currency, often collected by the seller or marketplace at checkout. Australia is the generous outlier: consignments at or below AUD 1,000 normally attract no duty, no GST and no processing charge at the border, although GST is collected at the point of sale on business-to-consumer orders. Treat every threshold as current-only and verify it before you price a product.
No. De minimis treatment was suspended for goods of Chinese and Hong Kong origin from May 2025, and then for all origins from August 2025. A US Customs and Border Protection rule effective June 2026 made that suspension indefinite for goods arriving by any mode other than the international postal network, and federal law repeals the exemption for commercial shipments from July 2027. In practice a low-value parcel from China now requires a formal or informal entry and pays duty from the first dollar.
Per consignment, not per item, in nearly every system. Three items of USD 60 shipped together in one box are a USD 180 consignment, not three small ones. Some regimes then layer a per-item charge on top: the European Union applies a temporary flat duty of EUR 3 per item on consignments up to EUR 150, so a box with three separate tariff lines can owe more than a box with one.
No, and it is a bad trade. Under-declaring is a customs offence that risks penalties, seizure and a held shipment, and it usually voids your insurance cover if the parcel is lost or damaged. The legal ways to reduce the bill are to use the correct commodity code, to claim a free trade agreement rate where one applies, and to consolidate shipments so you pay one entry fee instead of several.
Want to know the tax position before you commit to an order? Send me the product links, the quantities and the destination. I quote goods, freight, duty and my service fee as one figure, declare at the true value, and tell you up front which commodity code questions need settling — so the number you budget is the number you pay.
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