Following the United States and China announcing yesterday that they have agreed to drop substantial tariffs placed on each other for a 90-day period, through August 12, the White House announced later in the day, through an executive order, that it is lowering applied de minimis tariff rates placed on low-value imports under $800 imported into the United States from China and also Hong Kong.
As previously reported, the de minimis exemption had allowed shipments from China and Hong Kong to the U.S. to not be subject to tariffs. But that came to an end on May 2, based on an April 8 executive order issued by the White House, which stated that the initially-announced tariff of 30% of an item’s value, or $25 per item, whichever is more, would be increased to 90% and $75 or more, effective on or after 12:01 A.M. ET on May 2. And it added that fee per postal item containing goods will be increased from an initially-announced $50 to $150, effective, set to take effect on or after 12:01 A.M. ET on June 1.
But those parameters have now changed. In the executive order, entitled “Modifying Reciprocal Tariff Rates to Reflect Discussions with the People’s Republic of China,” the White House said tariffs on these low-value U.S.-bound shipments will be reduced to 54%, from its previous level of 120%, with the $100 duty fee per postal item remaining.
A Reuters report stated that based on these changes carriers can pay either the 54% or the $100 fee per package, adding that “logistics services providers or freight forwarders collect those seller fees from China in advance.” And the report added that the number of shipments that entered into the U.S., leveraging the de minimis exemption in recent years, was very high, at around 90%, with 60% originating from China, including retailers like Shein and Temu. It also observed that based on 2024 testimony given by a U.S. Customs and Border Protection official, the average value of a de minimis shipment in fiscal year 2023 was $54.
As reported by LM, under the Biden administration, the White House in 2024 said it was taking steps towards changing the rules around imports claiming the $800 de minimis exemption.
Noting that the majority of shipments claiming the import exemption originate from several China-founded e-commerce platforms (like Shein and Temu, among others) the White House proposed changes in which the de minimis exemption might not be allowed for products to which Section 201, 301, and 232 duties might otherwise apply.
In terms of the impact of not being able to leverage the de minimis exemption in the future, when it could eventually cease, as per the White House’s actions, industry stakeholders need to take various steps, including dealing with added paperwork and delays, and also working with and educating customers about any changes and expected and anticipated impacts.
