Why Trump is closing a trade exemption for China
Subscribe to enjoy similar stories. President Trump’s order imposing additional tariffs on China this week also suspended a popular trade exemption known as the de minimis provision that has let bargain platforms such as Shein and Temu skirt import duties and red tape on low-value packages from China. The order caused widespread confusion and prompted the U.S.
Postal Service to temporarily stop accepting parcels from China and Hong Kong before allowing them again. Here’s what to know about who benefits from de minimis and how ending it for China imports might affect companies and consumers: Under U.S. tax law, the de minimis exemption lets companies avoid import taxes and customs inspections on international shipments with a retail value of less than $800.
Congress raised the threshold from $200 in 2016. The provision dates to 1930 and was originally aimed at helping American travelers bring souvenirs back from abroad. Its use has ballooned in recent years, with the flood of goods from China-founded bargain sites Shein and Temu.
About 1.36 billion shipments using the de minimis provision entered the U.S. in fiscal year 2024, up from 637 million four years earlier, according to U.S. Customs and Border Protection.
Baird Equity Research estimates that Chinese imports represent 75% of de minimis products found online. The provision has faced a groundswell of bipartisan pressure in recent years, with lawmakers expressing alarm at the growing number of shipments. U.S.
Customs officials say it makes it easier for unsafe goods such as narcotics to enter the country, and U.S. companies say it lets China-linked platforms undercut their wares with low prices. Robert Brammer said his Traverse City, Mich., business Stromberg Carlson
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