Trump Executive Order Ends Tariff Exemption on Imports Less Than $800
In May, he eliminated the exemption for inexpensive goods from China, which had been the largest source of such shipments. His executive order signed on Wednesday ends the 'de minimis exemption' for goods from the rest of the world.
The policy allowed goods worth under $800 to enter the country without paying duty, and the shipments did not require the sender or recipient to complete detailed customs paperwork. As of Aug. 29, such shipments will be subject to the tariff placed on their country of origin.
Mr. Trump said the loophole had been used to 'evade tariffs and funnel deadly synthetic opioids as well as other unsafe or below-market products that harm American workers and businesses into the United States.'
De minimis shipments from China have ballooned in recent years, as American consumers bought billions of dollars of inexpensive goods from online retailers like Shein and Temu.
More than 60 percent of de minimis shipments in 2021 came from China and Hong Kong, according to a U.S. Customs and Border Protection report. Mr. Trump's order said the volume of de minimis shipments entering the United States surged to over 1.36 billion shipments last year from 134 million shipments in 2015. U.S. Customs processes on average over 4 million de minimis shipments each day, the order added.
After Mr. Trump ended the de minimis exemption for Chinese goods, express carriers like FedEx and UPS reported a steep decline in shipments from the country. UPS's chief executive, Carol Tomé, said Tuesday that increased tariffs and the elimination of the exemption had caused the daily volume of China-to-U.S. shipments to plunge 35 percent in May and June, compared with the same period a year ago.
The sweeping tax and domestic policy bill passed by Congress repealed the exemption for all countries in 2027, but Mr. Trump's order eliminates the loophole much sooner.
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