The plan is to extend marketplace liability to cover sales by UK businesses via online platforms, including domestic sales of goods such as retail items and takeaway food to tackle non-compliance, although a start date for the latest crackdown is not provided.

At the same time the chancellor Rachel Reeves is bringing forward 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 from October 2028, six months earlier than planned. Europe is moving faster on this with plans soon to go live, and the US also reduced the maximum threshold on small value packages recently.

The Treasury wants to clamp down on UK businesses that spread sales across a number of online marketplaces (OMPs) and other markets (disaggregation), which are structured to appear to operate under the VAT threshold, thus avoiding the requirement to register and pay VAT, when in fact they are really the same operation with a complex corporate structure to hide their true identity.