US slashes tariffs on small parcels from Hong Kong, mainland China
The US has announced it is slashing the tariffs on small packages shipped from Hong Kong and mainland China amid a de-escalation of the trade war between the world's two biggest economies.
Duties for goods sent from mainland China and Hong Kong worth under US$800 (HK$6,240) are set to decrease from 120 per cent to 54 per cent on Wednesday, according to US President Donald Trump's executive order issued on Monday.
Washington ended the 'de minimis' allowance, exempting such items from US duties, on May 2, imposing a 120 per cent tariff, or a flat fee of US$100, which was set to rise to US$200 next month.
According to the Monday statement, the US$100 levy remains in effect, but the plan to double the flat rate on June 1 has been scrapped.
The executive order was issued shortly after Beijing and Washington agreed to drastically lower tariffs for 90 days and continue negotiations, following high-level trade talks in Geneva last weekend.
Under the agreement, from Wednesday onwards, the US will reduce its tariffs on Chinese imports to 30 per cent from the previous 145 per cent, while China's duties on US imports will drop to 10 per cent, from 125 per cent.
Gary Lau, chairperson of the Hong Kong Association of Freight Forwarding and Logistics, told RTHK on Wednesday that the 54 per cent duty for small packages was still on the high side, and that sellers' orders would only return to normal levels if the rate falls to between 20 and 30 per cent.
He also said he expected a surge in exports with sellers taking advantage of the 90-day suspension period.
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