New EU charge set to see prices spike for many online shoppers

Parcels that have started arriving in Ireland from outside of the European Union (EU) will be hit with charges of at least €5 per distinct item as a result of two distinct fees that are now applied.

And while the fees are being imposed across the EU, the charges added by delivery companies in some circumstances are likely to more than double cost for many online shoppers.

The new Union Handling Fee that came into effect on Sunday is on top of a €3 charge per item that was imposed earlier this summer.

The charges and fees are mandated at EU level with delivery companies given the legal responsibility to collect them if the levies have not been paid during checkout on an online store.

The new charge is intended to cover the increased costs incurred by customs authorities as a result of the huge growth of ecommerce over the last number of years and will apply to all goods, regardless of their value, once a seller ships them to Ireland from outside the EU.

The massive growth in online marketplaces – based in China primarily – has caused dramatic upheaval and according to official estimates, about six billion packages with a value of less than €150 came into EU states from outside the European Union last year.

[ Online shoppers buying from outside EU face fresh charge of €2 per item from NovemberOpens in new window ]

As of now, when a package valued at €10 containing a pen, notebook and keyring is bought from outside of the EU, it will attract a customs duty charge of €9, comprising three lots of €3.

The EU handling fee of €2 per item adds an further €6 to the bill, bringing the end cost of the €10 to €25.

Consumers will be expected to pay the charges in one of two ways.

Some larger ecommerce operations will be set up to collect the customs duty and EU handling fee at the point of sale.

In such circumstances, both charges will be shown to the consumer and the total price paid at the checkout will be the final price, with no extra charges on delivery.

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Other websites may not collect these charges at checkout and the delivery company will be required to collect the money from the consumer.

When charges have to be collected in this way it is likely a further administrative charge of around €7 will be added to the total.

In such circumstances, then, the three small items that had an initial price tag totalling €10 could end up costing Irish consumers €32 or more than three times the original value.

There is no customs duty or EU handling fee if goods are based in Ireland, Northern Ireland or in another EU member state at the time they are ordered.