The Trump administration has lowered the tariff on low-value shipments (under $800) from China and Hong Kong from 120% to 54%, as part of a temporary trade truce.
The de minimis exemption, previously used by Chinese e-commerce giants like Temu and Shein to avoid tariffs, has been effectively nullified by the new policy.
Imports under $800 will now face either a 54% tariff or a $100 flat fee per parcel, with exporters choosing the payment method; the planned increase of the fee in June has been scrapped.
A day after announcing a temporary trade truce with China which significantly lowered tariffs, the Trump administration has gone a step further, cutting tariffs on low-value shipments from China. The levy is still high – 54% – but it had been 120%.
The executive order cuts the tariff on what is known as the “de minimis” tariff on shipments from China, including Hong Kong. The de minimis exemption previously allowed companies to avoid tariffs and customs inspections if the retail value was less than $800.
Chinese retailers Temu and Shein used the exemption to ship cheap goods directly to U.S. consumers without paying the extra tax.
This exemption significantly benefited fast-growing e-commerce companies like Shein and Temu, whose business models depend on shipping low-cost products directly to U.S. consumers from Chinese warehouses.
However, critics argued that this loophole gave foreign companies an unfair advantage over domestic retailers, who must comply with tariff and tax regulations. By bypassing duties, Chinese sellers could undercut American brands on price, often dramatically.
Starting May 14, imports from China and Hong Kong that are priced under the $800 threshold will be subject to either the 54% tariff or a flat $100 fee for each parcel. Exporters can decide whether to pay the tariff or flat fee. The White House said previous plans to double the $100 fee starting in June are no longer being considered.