Government Fast-Tracks Cheap Import Reforms and Online Seller Crackdown

High street businesses are set to benefit from a package of tax and customs reforms aimed at creating fairer competition between bricks-and-mortar retailers and online sellers.

Announced on 23 June 2026, the measures include accelerated plans to remove customs duty relief on low-value imports, a review of VAT compliance among online marketplace sellers, and proposals to reform VAT rules on land used for social housing developments.

In a move designed to support high street retailers, the government is bringing forward changes to low-value imports by six months. Under plans first announced at Budget 2025, goods valued at £135 or less will become subject to customs import duties, ending a relief that ministers say has given some overseas sellers an unfair advantage.

The reforms, now set to take effect from October 2028, are intended to create a more level playing field between online and high street businesses.

Alongside the import changes, ministers have launched a review into how VAT is collected from businesses trading through online marketplaces. The government is seeking views on strengthening existing rules to ensure all sellers comply with UK VAT obligations.

Revenue generated from improved VAT compliance will be used to support reforms to the business rates system, benefiting pubs, restaurants, hotels and other businesses that play a central role in local high streets.

Dan Tomlinson, Exchequer Secretary to the Treasury, said:

“This action tackles the unfair competition and dodgy businesses that are doing real damage to our high streets.

And by making sure that tax is paid when its owed, we can raise revenue to put back into improvements to the business rates system for pubs, restaurants, hotels and other high street businesses.”

The package also includes a consultation on reforming VAT treatment of land used for social housing developments. The government says the changes could help accelerate the delivery of affordable homes by ensuring VAT relief is more closely aligned with how social housing projects are developed.

Officials say the broader reforms form part of a drive to create a simpler, more digital-first tax and customs system that supports economic growth, reduces administrative burdens and strengthens fairness across the economy.

The government argues that together the measures will modernise tax collection, support high street businesses and ensure the system better reflects how goods are bought and sold in the digital age.