Aurora™ enables import and export at scale

By law, items coming into Europe valued at under 150 euros (the vast majority of shipments) must be pre-declared, and tax and duty must be paid.

There was no system in place to do this, so we created one which, in addition, insured against misdeclaration and fraud.

Challenge

The new EU VAT eCommerce package from 01.07.2021 will result in the requirement of digital pre-declaration (“data first”) including the mandatory use of HS codes for ALL shipments and ALL types of customs clearance (including postal). eCommerce and logistics value chain is in the crying need of reliable technology solutions for quick adaptation with new terms.

Small postal packages up to EUR 22.- delivered to European markets historically have not been required to have VAT applied. All packages up to EUR 150.- will now become mandatory to declare (including VAT payments) due to new regulations set by the EU – majority proportion from eCommerce transactions.

There are no systems in place to process the pre-declarations for these packages which has created a huge problem for the overall market, as well as individual eCommerce companies that are selling in to the EU as the packages need to be pre-declared and paid for, before they are shipped out and enter the destination country.

Electronic Customs Declaration will be mandatory for every consignment, before arrival of the goods for security, safety and VAT, abolishing current EU import exemption for consignments of value under EUR 22.-. The scale of the problem is so large that there are no reliable figures for the number of items that will need to be declared under the new rules.

Demand

As a direct result, businesses will benefit from a substantial reduction in cross-border VAT compliance costs. This will facilitate greater cross-border trade.

EU Businesses will be able to compete on equal footing with non-EU businesses that are not charging VAT.

Member States will gain through an increase in VAT revenues of EUR 10 billion annually.

EU VAT eCommerce Package

Modernising VAT for cross-border eCommerce

Latest news from European Commission Taxation & Customs Union.

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Are you ready for ICS2?

EU Customs pre-arrival security and safety programme supported by the Import Control System 2 (ICS2).

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