US President Donald Trump has reversed his decision to eliminate the “de minimis” loophole, allowing packages from China valued under $800 to be processed without customs duties or tariffs. The move came after concerns were raised by both the Biden and Trump administrations about fentanyl imports through de minimis packages and lost potential tariff revenue.
Trump signed an executive order that would allow low-value products from China to continue coming into the US without additional charges, pending the establishment of a system to fully and expediently process and collect tariff revenue. The change was made in response to concerns about the impact on discount Chinese online retailers Temu and Shein, which are responsible for an estimated 30% of de minimis US imports.
The elimination of the de minimis loophole had fueled explosive growth among these retailers, but it also threatened to increase prices and lead to shipping delays due to the need for Customs and Border Protection clearance. The US Postal Service briefly suspended acceptance of packages from China following the initial decision to eliminate the loophole.
The controversy surrounding de minimis has been ongoing, with concerns raised by both administrations about fentanyl imports and compliance issues. Temu’s business model relies heavily on the de minimis provision, but it has started shifting its focus towards US-based sellers, reducing its reliance on the exemption. Shein remains heavily reliant on direct shipping from China, making the end of the de minimis rule potentially detrimental to its business.
According to a congressional research report, more than 80% of all US e-commerce shipments were subject to de minimis in 2022. The move is part of Trump’s ongoing efforts to address trade tensions with China and implement tariffs on Chinese goods.
Source: https://www.forbes.com/sites/saradorn/2025/02/07/trump-reinstates-de-minimis-tariff-exemption-for-shipments-under-800-boosting-shein-and-temu