Is the EU Proposal for a Bucketing System; A Simplification or a Band-aid Solution?

This article discusses the proposal by the European Commission to eliminate the customs duty relief threshold which is to be offset by the introduction of a simplified tariff treatment for the distance sales, the so-called bucketing system. The aim of the Proposal is to mitigate the risk of consignment splitting, to reduce the incentive for undervaluation and increase tax revenue. Furthermore, the Proposal aims to reduce the administrative burden on traders and customs authorities. As applying the bucketing system is optional for traders, the design features of the proposed system may be decisive for traders to opt for the simplification and with it the the successful implementation of this system. This article explains and assesses the proposal in the light of the objectives set by the European Commission and its effectiveness in achieving these objectives.