- High street businesses backed with tax changes that will level the playing field.
- Government accelerates plans to scrap the duty relief on cheap imports and introduce new controls, supporting fair competition between high street and online retailers.
- New review into online sellers paying VAT they owe with government using new revenue to improve the business rates system for the high street.
- Package includes plans to reform VAT on sale of land, enabling affordable homes to be delivered quicker.
High street businesses are set to benefit from action to level the playing field as today (23 June 2026) the government sets out tax and customs reforms to make the system fairer, simpler and digital first.
To back the high street, the government is bringing forward changes to low value imports by six months in a move that targets cheap imports and puts Britain’s high streets first.
At Budget 2025, the Chancellor announced the scrapping of customs duty relief on low value imports (LVIs), meaning goods valued at £135 or less will be subject to customs import duties.
These changes ensure fairer competition between high street and online retailers. The government has since listened to industry and chosen to accelerate delivery of the reforms by six months to October 2028.
Meanwhile, with high street businesses frequently undercut by online-only sellers who dodge their tax obligations, minsters are reviewing how VAT is collected for businesses trading through online marketplaces.
They are seeking views on how the current online marketplace rules can be extended to ensure that all businesses comply with UK VAT rules. The revenue raised from this will go towards improvements to the business rates for pubs, restaurants, hotels and other businesses that are the lifeblood of the high street.
Together, these measures will support fair competition on the high street and online and help make sure that the right tax is collected in a way that better reflects how people buy and sell goods today.
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 changes also include a consultation on reforming VAT on land for new social housing, helping speed up delivery of affordable homes.
The proposal would ensure the tax system better reflects how social housing is developed, focusing VAT relief specifically on land used for delivering social homes while remaining balanced and affordable for taxpayers.
The plans announced today mark significant progress towards delivering a simpler, more customer-focused, tax and customs system that enables growth, reduces burdens and strengthens fairness across the economy.