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Straits Times
13-05-2025
- Business
- Straits Times
US to cut 'de minimis' tariff on China shipments, bolstering broader trade truce
FILE PHOTO: Parcels waiting to be processed are seen through a glass as a delivery worker's reflection appears on it in a post office, as Hong Kong Post stops certain U.S.-bound shipments since April 27 due to new U.S. tariff rules, in Hong Kong, China, May 2, 2025. REUTERS/Tyrone Siu/File Photo HONG KONG - The United States will cut the low value "de minimis" tariff on China shipments, a White House executive order said on Monday, further de-escalating a potentially damaging trade war between the world's two largest economies. The tariff relief comes in the wake of Beijing and Washington announcing a truce in their trade spat after weekend talks in Geneva, with both sides agreeing to unwind most of the tariffs imposed on each other's goods since early April. While their joint statement in Geneva didn't mention the de minimis duties, the White House order released later said the levies will be reduced to 54% from 120%, with a flat fee of $100 to remain, starting from May 14. The de minimis exemption, for items valued at up to $800 and sent from China via postal services, were previously able to enter the United States duty free and with minimal inspections. In February, President Donald Trump ended the de minimis exemption by imposing a tax of 120% of the package's value or a planned flat fee of $200 - set to come into effect by June - blaming it for being heavily used by companies such as Shein, Temu and other e-commerce firms as well as traffickers of fentanyl and other illicit goods. The number of shipments entering the U.S. through the tax-free channel exploded in recent years with more than 90% of all packages coming via de minimis. Of those, about 60% came from China, led by direct-to-consumer retailers such as Temu and Shein. Chinese online retailers Shein, PDD Holdings-owned Temu and U.S. rival Amazon did not immediately respond to requests for comment. In Monday's order, the White House said the reduced tariffs will take effect by 12:01 a.m. (0401 GMT)on May 14, 2025. The plan for a $200 flat fee duty rate would also be shelved, it said, keeping it at $100. China exported $240 billion in direct-to-consumer goods benefiting from de minimis worldwide last year, accounting for 7% of its overseas sales and contributing 1.3% of gross domestic product, according to Nomura estimates. China's yuan jumped to a six-month high against the dollar on Tuesday, joining a global rally in riskier assets following the broader trade deal between Beijing and Washington. Trump's global trade war, which shredded the playbooks that have governed international trade for decades, has shaken up financial markets and raised fears of a recession. BREATHING ROOM The U.S. de minimis rule, which dates back to 1938, has been the target of growing criticism from both Democratic and Republican lawmakers. Some have derided it as a loophole that allows cheap Chinese products to flood into the United States and undercut American industries, while also serving as cover for smuggling contraband such as illegal drugs and their precursor chemicals. De minimis, a legal term referring to matters of little importance which describes the U.S. waiver of standard customs procedures and tariffs, was one of the most generous exemptions in the world: the EU de minimis threshold, for example, is 150 euros ($156). The Geneva agreement slashed tariffs for both the United States and China by 115 percentage points each, to 10% and 30%, respectively, for at least 90 days. The tariff pause will give online retailers like Shein and Temu breathing space to adapt their businesses, say industry experts, as online retailers are likely to use the time to bring in bulk shipments and restock their U.S. warehouses. Big beneficiaries of de minimis include online retailers that ship goods mainly from China, such as Shein, Temu and Alibaba's AliExpress. Their growth prompted Amazon to start its own discount service, Haul, allowing marketplace merchants to ship $5 accessories and other items directly from China using de minimis. Separately, China has removed a ban on airlines taking delivery of Boeing planes in the wake of the Geneva trade deal, Bloomberg News reported on Tuesday, citing sources familiar with the matter. Officials in Beijing have started to tell domestic carriers and government agencies this week that deliveries of aircraft made in the United States can resume, Bloomberg said. REUTERS Join ST's Telegram channel and get the latest breaking news delivered to you.
Straits Times
13-05-2025
- Business
- Straits Times
US to cut 'de minimis' tariff on China shipments, bolsters broader trade truce
FILE PHOTO: Parcels waiting to be processed are seen through a glass as a delivery worker's reflection appears on it in a post office, as Hong Kong Post stops certain U.S.-bound shipments since April 27 due to new U.S. tariff rules, in Hong Kong, China, May 2, 2025. REUTERS/Tyrone Siu/File Photo HONG KONG - The United States will cut the low value "de minimis" tariff on China shipments, a White House executive order said on Monday, further de-escalating a potentially damaging trade war between the world's two largest economies. The move comes several hours after Beijing and Washington announced a truce in their trade spat after weekend talks in Geneva, with both sides agreeing to unwind most of the tariffs imposed on each other's goods since early April. While their joint statement in Geneva didn't mention the de minimis duties, the White House order released later said the levies will be reduced to 54% from 120%, with a flat fee of $100 to remain, starting from May 14. The de minimis exemption, for items valued at up to $800 and sent from China via postal services, were previously able to enter the United States duty free and with minimal inspections. In February, President Donald Trump ended the de minimis exemption by imposing a tax of 120% of the package's value or a planned flat fee of $200 - set to come into effect by June - blaming it for being heavily used by companies such as Shein, Temu and other e-commerce firms as well as traffickers of fentanyl and other illicit goods. The number of shipments entering the U.S. through the tax-free channel exploded in recent years with more than 90% of all packages coming via de minimis. Of those, about 60% came from China, led by direct-to-consumer retailers such as Temu and Shein. Chinese online retailers Shein, PDD Holdings-owned Temu and U.S. rival Amazon did not immediately respond to requests for comment. In Monday's order, the White House said the reduced tariffs will take effect by 12:01 a.m. (0401 GMT)on May 14, 2025. The plan for a $200 flat fee duty rate would also be shelved, it said, keeping it at $100. BREATHING ROOM The U.S. de minimis rule, which dates back to 1938, has been the target of growing criticism from both Democratic and Republican lawmakers. Some have derided it as a loophole that allows cheap Chinese products to flood into the United States and undercut American industries, while also serving as cover for smuggling contraband such as illegal drugs and their precursor chemicals. De minimis, a legal term referring to matters of little importance which describes the U.S. waiver of standard customs procedures and tariffs, was one of the most generous exemptions in the world: the EU de minimis threshold, for example, is 150 euros ($156). The Geneva agreement slashed tariffs for both the United States and China by 115 percentage points, to 10% and 30%, respectively, for at least 90 days. The tariff pause will give online retailers like Shein and Temu breather space to adapt their businesses, say industry experts, as online retailers are likely to use the time to bring in bulk shipments and restock their U.S. warehouses. Big beneficiaries of de minimis include online retailers that ship goods mainly from China, such as Shein, Temu and Alibaba's AliExpress. Their growth prompted Amazon to start its own discount service, Haul, allowing marketplace merchants to ship $5 accessories and other items directly from China using de minimis. REUTERS Join ST's Telegram channel and get the latest breaking news delivered to you.
Yahoo
21-04-2025
- Business
- Yahoo
DHL will now suspend consumer shipments ‘from any origin' that are over $800 because of a tariff-induced backlog at U.S. customs
DHL won't deliver packages to U.S. consumers that have a value above $800 'until further notice,' according to a company statement. The freeze is the result of delays in getting packages through U.S. customs owing to President Donald Trump's tariff policy. The multinational logistics and shipping company DHL said it would suspend shipments of over $800 to consumers in the U.S. because of delays in getting packages through customs. DHL, which is a subsidiary of the German Deutsche Post, said the suspension was the result of recent changes to U.S. customs regulations that lowered the minimum value at which parcels required formal processing, according to a statement. New regulations that went into effect April 5 lowered the threshold from $2,500 to $800. 'This change has caused a surge in formal customs clearances, which we are handling around the clock,' DHL said in a statement announcing the pause. In order to address the issue, DHL will halt shipments starting Monday, April 21, 'from any origin' that exceed the $800 limit 'until further notice,' a company spokesperson told Fortune in an email. The change to DHL's policy won't affect business-to-business shipments or deliveries to consumers that are less than $800, according to the company spokesperson. That said, DHL did warn even packages exempt from its shipping freeze could be subject to days-long delays regardless of where they come from because of the backlog at U.S. customs. Earlier this month, HongKong Post, the city's postal service, said it would suspend mail services for goods sent to the U.S. by sea starting April 27. HongKong Post cited the U.S.'s recent tariff policy and cancellation of the 'de minimis' provision that exempts deliveries to consumers valued at under $800 from having to go through customs. As of May 2, the U.S. will eliminate that exemption. Instead, those packages will now be subject to a 90% tariff or a flat fee of $75. Removing the de minimis provision was widely seen as a move targeting Chinese retailers that are popular with American shoppers. Companies like Temu and Shein that sell cheap, mass-market products would be hit especially hard by the new policy. Both companies said they would have no choice but to raise prices in response to the upcoming tariffs. The tariffs for mail are part of a broader trade war between the U.S. and China. Both countries have levied massive tariffs on each other over the past couple of weeks. The trade tensions kicked off when President Trump announced a set of sweeping tariffs on the vast majority of the U.S.'s trading partners. He then paused those tariffs on all countries except for China, which he subjected to a 145% tariff. The Chinese government replied with a 125% tariff of its own. HongKong Post directly attributed its move to suspend deliveries as a direct result of the U.S.'s new trade policy, which it called 'unreasonable and bullying.' It added that it did not want to contribute to the U.S.'s tariff policy. 'Hongkong Post will definitely not collect any so-called tariffs on behalf of the U.S.,' it noted, in a statement issued last week. Update, April 21, 2025: This article has been updated to include comments from DHL. This story was originally featured on
Int'l Business Times
21-04-2025
- Business
- Int'l Business Times
DHL To Suspend Global Shipments Over $800 To US Amid New Customs Rules
DHL Express, part of Germany's Deutsche Post, announced that it will stop shipping business-to-consumer (B2C) packages worth more than $800 to individuals in the United States, effective April 21. New U.S. Customs Rules Trigger DHL's Pause on High-Value Shipments This decision comes after new U.S. customs rules lowered the threshold for formal entry processing from $2,500 to $800, making the clearance process longer and more complicated. The update was shared on DHL's website, though the exact date wasn't mentioned. However, website data showed the notice was created on Saturday. DHL said the new customs regulations are the reason for the pause in high-value B2C shipments to the U.S. B2B Shipments to Continue as DHL Calls Move Temporary, Prepares for May 2 Changes DHL said that business-to-business (B2B) shipments will continue but might experience delays. Shipments valued under $800—whether to businesses or individuals—are not affected by the new rules. The company described the move as temporary. In a statement last week, DHL mentioned it would keep handling shipments from Hong Kong to the U.S. according to current customs rules. It also said it would help customers understand and adjust to more changes expected on May 2. Hong Kong Post Halts U.S. Shipments as Tariff War Escalates This update followed an announcement from Hong Kong Post, which said it had stopped sending goods by sea to the U.S. Hong Kong Post accused the U.S. of "bullying" after American officials removed tariff-free trade benefits for packages coming from China and Hong Kong. Starting April 27, it will also suspend airmail containing goods bound for the U.S. Tensions between the U.S. and China are growing, with the U.S. imposing new tariffs of up to 145% on Chinese and Hong Kong goods, and China responding with 125% import taxes on U.S. products. From May 2, the U.S. will also end its "de minimis" rule for China and Hong Kong, which allowed packages under $800 to enter tariff-free. These shipments will now face a 90% tariff or a flat fee of $75. From Domestic Ambitions to Focused International Shipping DHL Express handles international shipping in and out of the U.S. but does not offer regular domestic delivery services within the U.S. The company tried to enter the U.S. domestic parcel delivery market to compete with FedEx and UPS but struggled due to high competition and losses. In 2008, it announced it would shut down its U.S. domestic operations and focus only on international shipments to and from the U.S.
Forbes
16-04-2025
- Business
- Forbes
Hong Kong Post Suspends All Package Shipments To The U.S.—Blames Tariffs
Hong Kong Post on Wednesday announced it was suspending shipment of all packages to the U.S. as a result of the Trump administration's tariffs and the removal of an exemption that allowed lower value shipments to the U.S. duty free. In an announcement made on Wednesday, authorities in Hong Kong said the city's postal service will stop accepting surface shipments 'destined to the US with immediate effect.' For items sent by air mail, Hong Kong Post will stop accepting goods destined for the U.S. starting April 27. The city's officials attacked President Donald Trump's 145% tariff on all imports from China—which also applies to goods from the semi-autonomous city—saying: 'The U.S. is unreasonable, bullying and imposing tariffs abusively.' The Hong Kong officials said the city's postal service will 'definitely not collect any so-called tariffs on behalf of the U.S.' and therefore have decided to halt all outbound shipments. Goods that have been sent to Hong Kong Post but not yet been shipped to the US will be returned to the senders, who will be refunded the postage amount. Other postal items, including documents and letters, will not be impacted by this. Get Forbes Breaking News Text Alerts: We're launching text message alerts so you'll always know the biggest stories shaping the day's headlines. Text 'Alerts' to (201) 335-0739 or sign up here. The 'de minimis' provision was a special exemption granted to shipments entering the U.S., which were valued at $800 or less. Items covered under this provision could be shipped to the U.S. without paying duties or certain taxes. Earlier this year, Customs and Border Patrol reported it had processed at least 1.36 billion 'de minimis' shipments in the fiscal year 2024, which was a nearly ten-fold increase from 2015. While the report did not mention how much of these de minimis shipments came from China, a study commissioned by the House Select Committee on the Chinese Communist Party found nearly half of all 'de minimis' shipments entering the U.S. originated from China. Earlier this month, Trump signed an executive order to eliminate the provision for imports coming from China and Hong Kong. The initial announcement said these goods would face a tariff rate of 30% starting May 2, but this number has since been raised to 120%, or face a per postal item fee of $100—which will increase to $200 in June. One Community. Many Voices. Create a free account to share your thoughts. Our community is about connecting people through open and thoughtful conversations. We want our readers to share their views and exchange ideas and facts in a safe space. In order to do so, please follow the posting rules in our site's Terms of Service. We've summarized some of those key rules below. Simply put, keep it civil. Your post will be rejected if we notice that it seems to contain: User accounts will be blocked if we notice or believe that users are engaged in: So, how can you be a power user? Thanks for reading our community guidelines. Please read the full list of posting rules found in our site's Terms of Service.
