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US President Donald Trump suspended the repeal of the de minimis provision, which allows packages with worth less than $800 to enter the US duty free
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US authorities were caught unprepared for Trump’s order repealing duty-free imports of low-cost packages from China last week
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With packages swamping US customs, Trump was forced to suspend his order, giving the Commerce Department adequate time to make the order workable
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The order ending de minimis exemptions caused disruptions for customs inspectors, postal and delivery services, and online retailers
US President Donald Trump has suspended the repeal of the de minimis provision, which would have closed the tariff exemption on low-cost shipments from China.
A new executive action announced on Friday (US time) said the delay will last until “adequate systems are in place” for the Commerce Department “to fully and expediently process and collect tariff revenue.”
The de minimis provision allows packages worth less than $800 to enter the US duty-free.
Uncertainty on how to enforce Trump’s first order repealing de minimis caused disruptions that led to bottlenecks with Customs clearances for packages, including those which had already paid duties, notably at New York’s John F. Kennedy Airport.
The order caused disruptions for customs inspectors, postal and delivery services, and online retailers.
The repeal was part of Trump’s announcement of 10% across-the-board tariffs on China, a move that, along with retaliatory tariffs from China, could reshape global trade.
The change was implemented with barely two days’ notice, causing the US Postal Service to temporarily stop accepting packages from China and Hong Kong and then reverse policy the next day.
Shipping experts and lawyers had warned that Trump’s order would overwhelm customs inspectors because the agency does not have systems and processes in place.
Experts said the suspension would overwhelm US Customs and Border Protection since more than 80% of total US e-commerce shipments in 2022 were de minimis imports, according to a congressional research report.
The cancellation of de minimis would have meant more than a billion low-value (below $800) e-commerce packages from China to the US will have to switch to an entry process needing more information and duties, adding more time and cost.
Clark Packard, a research fellow at the libertarian Cato Institute, said, “You would have to have a lot more people on the ground. The reality is that right now Customs and Border Protection is just not qualified or capable of handling this because of the volume of packages.”
Niall van de Wouw, chief air freight officer at freight pricing platform Xeneta, pointed out that Temu and Shein combined ship some 9,000 metric tons of cargo worldwide daily, or about 88 full Boeing 777 freighters.
“You cannot suddenly put up shutters to this volume of air freight, so it is no surprise that there has been a delay to the executive order on de minimis.”
Shein, Temu, and Amazon Haul send packages directly to US consumers from Chinese factories using de minimis to keep prices low.
Trump said one reason for scrapping the duty-free treatment for Chinese goods was to stem the flow of fentanyl into the US.
White House officials have said Canada and Mexico are also conduits for shipments of fentanyl from China in small packages not usually inspected by customs agents.
