US online retailer Temu is promoting products shipped from its US warehouses more prominently in its app, following President Donald Trump’s decision to revoke a popular tax exemption called de minimis. The exception allowed e-commerce companies to send goods worth less than $800 into the US duty-free.
De minimis had helped propel Temu and Shein to explosive growth in the US by allowing them to bypass taxes on low-value shipments, enabling rock-bottom prices on products such as shoes, clothes, furniture, and electronics. However, with the exemption revoked, Temu is now promoting sellers who have inventory in US warehouses, rather than items shipped directly from China.
The move puts Temu in direct competition with Amazon, eBay, and Walmart, which also ship goods to their warehouses from China. According to e-commerce market research firm Marketplace Pulse, roughly 20% of Temu’s US sales come from US-based sellers by July this year.
The decision has caused uncertainty for Chinese online retailers like Temu, with its stock price fluctuating significantly in the past week. Critics argue that de minimis provided an unfair advantage to Chinese e-commerce companies and raised concerns about counterfeit and unsafe goods. Others advocate for the exemption’s removal, citing potential burdens on customs officials and higher government costs.
As the situation unfolds, US Customs and Border Protection has announced plans to implement an efficient collection mechanism for new China tariffs, aiming to minimize disruption to package delivery.
Source: https://www.cnbc.com/2025/02/05/temu-steers-users-to-local-products-after-trump-ends-de-minimis.html