The US has ended a decades-old trade loophole called the de minimis exemption, which allows package shipments valued at under $800 to enter the country without tariffs. This change, signed by President Donald Trump, goes into effect May 2 and is expected to increase prices for American consumers and slow down shipment times. The move aims to curb illegal substances, including synthetic opioids, but critics argue it may have limited effects in curbing these threats.
The de minimis exemption had allowed packages to be shipped from China and Hong Kong without tariffs, saving the US government processing costs. However, lawmakers and officials have long pointed to this loophole as a “major pathway” for illegal substances, citing concerns over cheap goods flooding the market with fake and sometimes deadly imported products.
President Trump’s executive order, signed in April, ends the exemption and will require package shipments from China to be subject to tariffs starting May 2. Hong Kong’s postal service has suspended package delivery to the US, while Chinese-based companies Shein and Temu have announced price hikes for US customers.
Industry experts say this change may help US manufacturers, but critics argue that it will not significantly impact the flow of illegal substances into the country. Many fentanyl and synthetic opioids enter the US through the southern border with Mexico, according to federal officials. The end of the de minimis exemption may also force companies to find new ways to circumvent tariffs, potentially leading to longer shipment times and higher prices.
American consumers can expect to pay more for goods imported from China, as well as experience slower delivery times. Ninety-two percent of all cargo entering the US falls under the de minimis exemption, and packages valued at or below $800 will now face new tariffs and fees starting May 2.
Source: https://www.pbs.org/newshour/economy/what-the-end-of-the-de-minimis-exemption-could-mean-for-your-online-orders