The UK Government has given the Channel Islands just four months notice before closing a tax
loophole it estimates is costing £140 million pounds in tax a year.
Many big retailers have opened warehouses in the Channel Islands to take advantage of an internet VAT loophole that allows retailers to avoid paying VAT by sending goods from the Channel Islands.
The Channel Islands are treated as being outside the EU for VAT purposes.
Low value consignment relief will not apply to goods sent from the Channel Islands to the UK from April 1.
The Chief Minister of Guernsey, Deputy Lyndon Trott, says the change will have a 'significant impact' on the islands.
It's estimated 1,700 jobs in the Channel islands are reliant on the trade.
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