Latest news with #TariffActof1930
Yahoo
16-05-2025
- Business
- Yahoo
US textile sector backs proposal to end de minimis for all countries
The US House Ways & Means Committee, the chief tax-writing committee in the House of Representatives, included a provision in the budget reconciliation bill that would eliminate de minimis entry privilege for commercial shipments permanently. According to Section 321 of the Tariff Act of 1930, shipments destined for businesses and consumers in the US with a value below $800 are permitted entry into the country without being subjected to duties and taxes. The provision was terminated for goods from China, including Hong Kong and Macau, as of 2 May, but it remains applicable to imports from other nations. The latest provision 'repeals the de minimis privilege worldwide' effective 1 July 2027. It added that 'this section also increases penalties for violators of Section 321 of the Tariff Act of 1930'. NCTO president and CEO Kim Glas said: 'On behalf of the US textile industry, we would like to commend the House Ways and Means Committee for including an important and critical provision in the broader budget reconciliation bill that would permanently end de minimis access for commercial shipments from all countries, effective 1 July 2027. 'The committee is slated to consider and mark up this legislation today. This significant step by chairman Jason Smith (R-MO), Rep. Greg Murphy (R-NC), and the entire committee validates that the destructive de minimis loophole has harmed US textile manufacturing and impeded the fight against illicit fentanyl trafficking and must be permanently closed.' Data from US customs revealed a surge in de minimis exemption use by over 600%, climbing from around 139m shipments in fiscal year 2015 to over 1bn annually in 2023. In 2024, shipments entering under de minimis reached 1.36bn. The proposed legislation maintains lower de minimis levels for gifts and personal items brought into the US. Additionally, it introduces penalties for misuse of de minimis before this deadline to import goods in violation of US laws, setting fines at $5,000 for initial infractions and $10,000 for subsequent ones. Glas added: 'As the bill makes its way through the legislative process, we strongly support a more aggressive timeline to implement a permanent ban on de minimis globally given its significant harm to manufacturers, retailers, and the fight against fentanyl and other illegal products. Express shippers have already transitioned to processing all Chinese imports through sophisticated logistics systems, demonstrating their ability to comply with the president's executive orders and pivot quickly. 'We recognise the committee's leadership in moving forward with a permanent global solution that will help restore a level playing field for US manufacturers and spur more investment and job growth.' Earlier this month (May), NCTO praised the Trump Administration's termination of de minimis for low-value shipments from China and Hong Kong and called for an extension of this policy to all countries. "US textile sector backs proposal to end de minimis for all countries" was originally created and published by Just Style, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
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Business Standard
13-05-2025
- Business
- Business Standard
US to reduce 'de minimis' tariff on China shipments to 54% from 120%
The United States is planning to cut the low-value 'de minimis' tariff on China shipments from 120 per cent to 54 per cent, along with a flat fee of $100 to be in place, according to an order from the White House released Monday (local time). The executive order will come into effect starting May 14. It comes a day after the US and China engaged in trade talks negotiations in Geneva and announced a 90-day pause on the previously imposed tariffs, which escalated tensions between the two countries. Following the trade truce, both the US and China decided to slash the tariff by 115 percentage points. They also slashed the tariffs on goods imported. While the US brought down China's tariffs to 30 per cent from 145 per cent, China reduced the tariffs imposed on US-made goods to 10 per cent from 125 per cent. Previously, under the de minimis exception, goods valued at up to $800 and sent from China through postal services were able to enter the US duty-free and without minimal inspections. The de minimis exemption ended in February after US President Donald Trump imposed a tax of 120 per cent of the package's value or an already decided fee of $200, which was set to come into effect in June. A Reuters report suggests that this de minimis exception was being used heavily by Chinese companies like Shein and Temu, and other e-commerce companies, along with traffickers of fentanyl. What is the de minimis rule? The de minimis rule dates back to 1938 and allows the entry of goods valued at $800 or less per shipment duty-free. The rule is crucial under Section 321 of the Tariff Act of 1930. By minimizing the formal customs procedures, this rule allows the importation of low-value goods into the US. Under the de minimis rule, Chinese companies like Shein and Temu were able to offer competitive prices in the US as they did not have to incur any additional tariffs. With the exemption gone, most products from China now face high tariffs, which threaten the ultra-low-price strategy these companies used to win over the US consumers. In response, both Shein and Temu cut back on advertising in the US and started expanding to other places, like Europe. Amazon even launched a similar service, Amazon Haul, which went live last week in the UK and Saudi Arabia. How Chinese e-commerce companies operated under tariffs When tariffs went up, Shein and Temu changed their strategy. Instead of sending each order directly from a Chinese factory to a US customer, they began shipping in bulk and storing items in US warehouses. Temu also announced that, starting May 2, all its US sales are now handled by locally based sellers. "Temu has been featuring products already in US warehouses," according to a Reuters report, as the company shifts away from its factory-to-door model. Meanwhile, air freight traffic between China and the US has decreased.
Saudi Gazette
03-05-2025
- Business
- Saudi Gazette
US ends duty-free import exemption for China, hitting low-value e-commerce shipments
WASHINGTON — The United States on Friday officially revoked the de minimis exemption for low-value imports from China and Hong Kong, ending a long-standing trade provision that allowed shipments under $800 to enter the country duty-free. The move, enacted through an executive order signed by President Donald Trump on April 2, marks a significant escalation in the US-China trade dispute. The White House said the decision aims to curb the flow of synthetic opioids like fentanyl and to close what Trump described as a 'scam' that disadvantages American small businesses. 'It's a big scam going on against our country, against really small businesses. And we've ended, we put an end to it,' Trump said during a Cabinet meeting earlier this week. The end of the exemption will subject all qualifying imports from China and Hong Kong to standard duties and tariffs — with some goods potentially facing rates as high as 145%. The measure is expected to particularly impact e-commerce platforms such as Shein, Temu, and third-party Amazon sellers, which relied heavily on the exemption to avoid duties on bulk low-value analysts say the decision will significantly increase the workload for U.S. Customs and Border Protection (CBP), which will now be required to inspect millions more small packages each day, potentially leading to delays and logistical strain.'The way we shop online will never be the same,' said Ram Ben Tzion, CEO of logistics platform Publican, in comments to CBS 321 of the Tariff Act of 1930 previously allowed duty-free entry for shipments below a de minimis threshold, which Congress raised from $200 to $800 in 2016. According to a Congressional Research Service report, Chinese exports of such low-value parcels soared from $5.3 billion in 2018 to $66 billion in 2023. — Agencies
Miami Herald
03-05-2025
- Business
- Miami Herald
A ‘big scam'? The end of a shipping loophole on China goods and what it means for consumers
A decades-old shipping loophole that made imported goods cheaper for customers and boosted foreign e-commerce platforms such as Shein and Temu sunsetted Friday. The 1938 provision, called the 'de minimis' exception, formerly allowed shipments under $800 to enter the U.S. duty-free. Trump last month signed an executive order eliminating the exemption for goods imported from China and Hong Kong in what the White House called a 'critical step in countering the ongoing health emergency posed by the illicit flow of synthetic opioids into the U.S.' Federal officials have previously accused China of fueling the U.S. fentanyl crisis by supplying fentanyl precursors to illicit drug manufacturers. Trump's move to restrict the shipping loophole is the latest in a slew of trade policy revisions poised to affect millions of consumers and small businesses who rely on low-cost goods from China. Here's what to know: What is the shipping loophole? Congress first introduced the 'de mimimis' exception in 1938 as Section 321(a)(2)(C) of the Tariff Act of 1930, licensing duty waivers for small shipments in order to streamline customs operations. The policy was designed to boost trade and spare the government the hassle of processing low-value parcels generating negligible tax revenue. Congress has raised the 'de minimis' exemption threshold several times since the policy's initial adoption. In 2015, the figure rose for the last time to $800. U.S. Customs and Border Protection processes 'nearly 4 million duty-free de minimis shipments a day,' most of them coming from China and Hong Kong, a spokesperson for the agency told CNN. In the last fiscal year, 1.36 billion shipments came to the U.S. under the shipping exemption. Why did Trump end it? The White House said that Trump disqualified China from the trade loophole because of the country's 'deceptive shipping practices,' including an alleged pattern of smuggling 'illicit substances' into the U.S. and bordering countries. Moreover, the country 'enforces strict import restrictions and tightly limits de minimis exemptions, showing no similar leniency toward U.S. shipments,' a White House fact sheet said. The president also argued the exemption has allowed Chinese e-commerce giants to edge U.S. retailers out of the market. 'It's a big scam going on against our country against, really, small businesses and we've ended it,' Trump said Wednesday during a Cabinet meeting. How will this affect consumers? Foreign e-commerce platforms impacted by the loophole's closure will probably pass price increases on to shoppers. Thus, U.S. consumers who rely on such platforms for bargain-priced clothing and other household goods may struggle to shoulder new higher costs. It's a harsh blow when Americans are already anxious about rising costs stemming from the steep tariffs Trump has levied on Chinese imports. Plus, it's not just Chinese goods that may skyrocket in price. Trump said in an executive order that 'de minimis' packages from other countries are also slated to lose their tariff exemption as soon as the government can develop a system to 'expeditiously process and collect' the duties,' Bloomberg reported. What about the fallout for Shein, and others? Shein has already raised its prices, with its top 100 products in the beauty and health category seeing an average increase of 51%, Bloomberg reported. Singapore-based Shein and China-owned Temu stand to lose significant business from U.S. consumers aggrieved by the price hikes and decreased product availability. Plus, shoppers are likely to become frustrated with slow shipping resulting from stricter customs protocols. Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
Yahoo
02-05-2025
- Business
- Yahoo
A 'big scam'? The end of a shipping loophole on China goods and what it means for consumers
A decades-old shipping loophole that made imported goods cheaper for customers and boosted foreign e-commerce platforms such as Shein and Temu sunsetted Friday. The 1938 provision, called the "de minimis" exception, formerly allowed shipments under $800 to enter the U.S. duty-free. Trump last month signed an executive order eliminating the exemption for goods imported from China and Hong Kong in what the White House called a "critical step in countering the ongoing health emergency posed by the illicit flow of synthetic opioids into the U.S." Federal officials have previously accused China of fueling the U.S. fentanyl crisis by supplying fentanyl precursors to illicit drug manufacturers. Trump's move to restrict the shipping loophole is the latest in a slew of trade policy revisions poised to affect millions of consumers and small businesses who rely on low-cost goods from China. Here's what to know: Congress first introduced the "de mimimis" exception in 1938 as Section 321(a)(2)(C) of the Tariff Act of 1930, licensing duty waivers for small shipments in order to streamline customs operations. The policy was designed to boost trade and spare the government the hassle of processing low-value parcels generating negligible tax revenue. Congress has raised the "de minimis" exemption threshold several times since the policy's initial adoption. In 2015, the figure rose for the last time to $800. U.S. Customs and Border Protection processes 'nearly 4 million duty-free de minimis shipments a day," most of them coming from China and Hong Kong, a spokesperson for the agency told CNN. In the last fiscal year, 1.36 billion shipments came to the U.S. under the shipping exemption. The White House said that Trump disqualified China from the trade loophole because of the country's "deceptive shipping practices," including an alleged pattern of smuggling "illicit substances" into the U.S. and bordering countries. Moreover, the country "enforces strict import restrictions and tightly limits de minimis exemptions, showing no similar leniency toward U.S. shipments," a White House fact sheet said. The president also argued the exemption has allowed Chinese e-commerce giants to edge U.S. retailers out of the market. "It's a big scam going on against our country against, really, small businesses and we've ended it," Trump said Wednesday during a Cabinet meeting. Foreign e-commerce platforms impacted by the loophole's closure will probably pass price increases on to shoppers. Thus, U.S. consumers who rely on such platforms for bargain-priced clothing and other household goods may struggle to shoulder new higher costs. It's a harsh blow when Americans are already anxious about rising costs stemming from the steep tariffs Trump has levied on Chinese imports. Plus, it's not just Chinese goods that may skyrocket in price. Trump said in an executive order that "de minimis" packages from other countries are also slated to lose their tariff exemption as soon as the government can develop a system to 'expeditiously process and collect' the duties," Bloomberg reported. Shein has already raised its prices, with its top 100 products in the beauty and health category seeing an average increase of 51%, Bloomberg reported. Temu, one of Shein's primary competitors, said in a statement to the Washington Post that it is moving to a 'local fulfillment model,' with U.S. orders handled by sellers in the United States in an effort to sidestep tariffs. Customers have already expressed disappointment about products being removed from their shopping carts because they were not certified "local" to the U.S., the outlet reported. Singapore-based Shein and China-owned Temu stand to lose significant business from U.S. consumers aggrieved by the price hikes and decreased product availability. Plus, shoppers are likely to become frustrated with slow shipping resulting from stricter customs protocols. Sign up for our Wide Shot newsletter to get the latest entertainment business news, analysis and insights. This story originally appeared in Los Angeles Times.
