The additional tariffs imposed by President Donald Trump on China, Canada and Mexico reportedly include a provision that will eliminate a longstanding rule that allows small packages to enter the U.S. without a paying a tariff.
This rule — the “de minimis” exemption that applies to packages worth less than $800 — is commonly used by Chinese eCommerce retailers to sell goods at lower prices by shipping them directly to consumers in the U.S., Bloomberg reported Saturday (Feb. 1).
Trump’s putting an end to this exemption could affect retailers like Alibaba, JD.com, Shein and Temu, according to the report. Temu, for example, has benefited from this exemption by offering low prices to shoppers who were willing to wait for the goods to be delivered.
About $48 billion worth of shipments from outside the U.S. were imported by American consumers and companies in the first nine months of 2024, per the report. More than 10% of exports from China are small shipments covered by the exemption.
A senior administration official told reporters that the exemption costs the U.S. revenue and makes it easier for criminals to get fentanyl and the precursor chemicals used to make it into the country undetected, according to the report.
Trump’s tariffs are to take effect Tuesday at 12:01 a.m. Eastern time, per the report.
Trump announced the imposition of additional tariffs on imports from China, Canada and Mexico on Saturday, saying he aims to halt the importation of illegal drugs.
“President Trump is taking bold action to hold Mexico, Canada, and China accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country,” a fact sheet released by the White House said.
Former President Joe Biden’s administration said in September that it proposed rules that targeted the de minimis exemption.
The Biden administration said at the time that the trade rules had been abused by China-founded eCommerce platforms and that the number of shipments claiming the exemption had risen from 140 million a year to over 1 billion a year over the last decade.
It was reported in June that Amazon was preparing to add a section to its shopping site that aims to compete with Temu and Shein by featuring items that are cheap and are shipped from China to overseas consumers.
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