Trump could triple tariffs and plug the loophole in “de minimis” which could affect temu and shein
Chinese freight under $800 faces 90% tariffs, affecting companies like Shein and Temu. Trump has ended the “de minimis” exemption.
Straight Arrow News
The trade loophole that allows less valuable goods shipped to US tax-free goods on August 29, after President Donald Trump signed an executive order to sunset the de Minimis trade agreement last month, is expected to end on August 29.
The White House said in July that packages sent to the US for under $800 sent to the US outside the international postal network have now faced “all applicable obligations.”
Shein and Temu are two popular fashion brands that attract American shoppers and often seek to order bulk orders at a heavily discounted cost, often with free shipping. With the end of the trade loophole, US consumers are looking to increase prices, including the fast fashion orders they once had.
Here’s how changes to policy will affect consumers:
What is De Minimis and why does it affect Shein and Temu?
Shein and Temu sell a variety of products, including clothing, furniture and more, which arrive quickly and cheaply.
More than half of all packages, including the De Minimis exemption, come from China, and more than 30% of all daily packages shipped under De Minimis are from Temu and Shein, Reuters reported in February.
The provisions of the 1930 Customs Act allow the De Minimis exemption, which is the main route for e-commerce imports from China, according to a parliamentary report from 2018 to 2023.
How will change affect consumers?
Shein and Temu announced in early April that prices will rise on both platforms in response to changes in trade policy between the US and China. They have yet to announce how much prices will rise once the De Minimis trade loophole ends at the end of August.
Eliminating China’s loopholes would have “a widespread negative impact on Americans, particularly poor consumers, especially poor consumers,” according to the Cato Institute.
Republican Sen. Jim Banks of Indiana welcomed the executive order, saying, “For too long, countries like China have been flooding the market with tax-free, cheap imports.”
Contributions: Kinsey Crowley and Staff, USA Today; Reuters
