US ends tariff exemption for low-value packages

New tariff rules will impact the cost of low-value imported goods.

US ends tariff exemption for low-value overseas packages

The United States government is set to end a longstanding tariff exemption for low-value commercial shipments. Effective August 29, packages valued at or under $800 that come outside the international postal network will now attract full duties. This decision follows an executive order signed by Donald Trump and is part of a broader strategy to address national emergencies and protect American businesses. Recently, the White House noted that a new spending bill will officially repeal the legal foundation for this exemption starting July 1, 2027. The change means goods shipped via postal services will incur either an ad valorem duty based on the effective tariff rate of the origin country or, for a temporary period, a specific duty ranging from $80 to $200, based on the country’s tariff policy.

The decision to eliminate the de minimis exemption signals a significant shift in U.S. trade policy, particularly aimed at curbing imports from countries like China and Hong Kong, which have heavily relied on this privilege. By reinstating tariffs, the government may aim to funnel more revenue and protect local industries, yet there are concerns about how this will affect consumers and small businesses. The potential increase in prices for everyday goods could resonate, prompting public backlash as higher costs burden consumers already facing inflation. This policy adjustment reflects ongoing tensions around global trade, especially as the U.S. seeks to navigate its economic priorities amid international competition.

Highlights

The ripple effects of this change will unfold as international trade dynamics shift.