Is your Temu acquisition astir to get much expensive?
Low-price online retailers for illustration Temu and Shein person been utilizing a waste and acquisition proviso (available since the 1930s) to thief them turn successful the U.S.—and connection little prices than States-based competitors.
However, connected Saturday, erstwhile President Trump signed an executive bid (EO) that puts tariffs and taxes connected equipment and energy imported from China, Mexico (now paused), and Canada starting Tuesday, it will besides extremity a lesser-known but wide utilized exemption known arsenic "de minimis," a proviso that allows packages worthy little than $800 to beryllium shipped to the U.S. duty-free.
The loophole has helped companies for illustration Temu and Shein connection other debased prices connected equipment and has fueled their accelerated maturation successful the U.S. Bloomberg reports that the 2 companies person been anticipating the news for a twelvemonth and person been expanding their shipping networks stateside.
Still, CNBC reports that Trump's actions could thief companies including Amazon, Etsy, and eBay becasue their platforms fto third-party sellers link to U.S. consumers directly.
What is the 'de minimis' provision?
The de minimis proviso has existed since the 1930s, but its usage has exploded successful caller years pinch the emergence of e-commerce.
The proviso allows packages worthy little than $800 to beryllium sent to the U.S. duty-free.
According to data from the U.S. Customs and Border Protection Agency, the U.S. processed much than 1.3 cardinal de minimis shipments successful 2024 (it was only 139 cardinal successful 2015) worthy more than $48 billion.
Last fall, the Biden management looked to extremity the "overuse and abuse" of de minimis, per CNBC, noting the loophole helps Chinese e-commerce companies connection little prices than companies stateside.
"The drastic summation successful de minimis shipments has made it progressively difficult to target and artifact forbidden aliases unsafe shipments coming into the U.S.," Daleep Singh, a past lawman nationalist information advisor for world economics, said successful September.