Closing of trade loophole may affect cheap imports
By: Kathryn Palmer
USA Today
..... Prices on imported low-cost goods are likely to rise soon, as a trade loophole allowing many retailers to avoid President Donald Trump's tariff hikes is set to expire this week. [08/29/2025]
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The exception which applied to items shipped to the United States and valued at $800 or less, will end August 29, [2025] following the president's executive order in late July, [2025] effectively sunsetting the "de minimis trade agreement: for all nation. in 2024, de minimis shipments were valued at more than $1.36 billion, according to U.S. Customs and Border Protection.
..... This means consumers may see higher costs and possible supply disruptions, as the Trump administration effectively ends the duty-free program across the board.
..... In preparation of the change, Reuters reports postal groups in several European entires have announced they will pause standard parcel shipments to the United States.
..... The de minimis exemption refers to Section 321 of the Tariff Act of 1930, which allows the treasury secretary to waive some duties or fees where it is more inconvenient to collect the tax than the revenue wold be worth. in practice, the policy allowed companies to ship low-value packages to the United States tariff-fee. The Trump administration said in April. [2205] before the executive order ending the exemptions, that Customs and Border Patrol precess over 4 million de minimis shipments into the United States each day.
..... The exception has been the subject of back-and-forth over the past few months between the trump administration and China. It was originally set to end in February, [2025] but it was then postponed after packages began pilling up without time to plans and execute the policy change.
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The August 29 [2025] deadline comes a few months after the loophole was closed on May 2 [2025] for imports, specifically from China and Hong Kong, where behemoth-low retailers like Shein and Temu ship a significant portion of their products. Over half of all packages with de minimis exemptions come from Chin, and more than 30% of all daily packages shipped under de minimis are from Temu and Shein, Reuters reported in February. [2025]
..... With the end of the exception for imports from all other nations, the same impacts that Shein and Temu have wrestled with may soon hit other low-value goods retailers.
..... Ernie Tedeschi, director of economics at Yale Budget Lab, said the end of de minmis could affect health and beauty items, apparel, household goods and various bespoke or boutique items that are imported.
....."For consumers that are shopping at a lot of big name-brand stores like Target, Walmart, Costco, this is not relevant to them," Tedeschi said. "Those stores have already been hit by tariff increases, and so that should be incorporated into those prices at the moment."
..... Yet, shoppers may see a disruption in availability or stock before they notice any price hikes, according to Tedeschi. He pointed to the package pileup when Trump first tired ending the exemption in February. [2025]
..... Kathryn Palmer is a national trending news reporter for USA Today.