President Donald Trump made his “Liberation Day” announcements this Wednesday delivering a blow. He made statements which were not just key to trading partners, but also to popular companies like ultra-cheap Chinese retailers Shein and Temu.
It was long before that Trump announced a flurry of new tariffs, and now the White House has said that the president signed an executive order shutting down the de minimis trade loophole beginning May 2. Under this loophole, shipments which are worth less than $800 can enter the U.S. duty-free. This will allow foreign retailers to sell their products to US citizens for cheap.
It was in February that Donald Trump suspended the trade exemption but later delayed the cancellation after the U.S. Postal Service said it would stop all inbound packages from China and Hong Kong.
🚨 LIBERATION DAY 🚨
TRUMP RECIPROCAL TARIFFS
Minimum baseline tariff of 10% on all other countries.
via: Reuters#Trump #TrumpTariffs #LiberationDay pic.twitter.com/Cbn4bR0Y2f
— Brit Ian (@dearbrit_ian) April 2, 2025
The announcement made on Wednesday means that goods which are valued at or under $800 will now be subjected to a duty of either 30% of the value or $25 per item, which will rise to $50 after June 1.
The White House has also claimed that shutting down of the de minimis exemption was “a critical step in countering the ongoing health emergency posed by the illicit flow of synthetic opioids into the U.S.”
“President Trump is targeting deceptive shipping practices by Chinese-based shippers, many of whom hide illicit substances, including synthetic opioids, in low-value packages to exploit the de minimis exemption,” it said in a fact sheet.
“While the U.S. previously offered a generous de minimis exemption, China enforces strict import restrictions and tightly limits de minimis exemptions, showing no similar leniency toward U.S. shipments,” the White House added.
In February, when the Trump administration briefly suspended de minimis exemption, Cato Institute, the libertarian think tank said it “effectively rais[ed] taxes on American consumers and dramatically increas[ed] shipping times.”
🔴USA 🇺🇲| #TrumpTariffs : a #LiberationDayInAmerica for president #Trump who unveiled on April 2, his threatening doctrine of trade reciprocity. New #CustomsTariffs are imposed on countries that tax American products entering their territory. Theses taxes range from 10% to 50%. pic.twitter.com/khQLSMrGYd
— Nanana365 (@nanana365media) April 3, 2025
Critics of this exemption, on the other hand, argue that the “loophole has hurt American businesses,” as per Axios.
“The ability for non-U.S. retailers to sell their products at drastically lower prices to U.S. consumers has significantly impacted the Company’s ability to retain its traditional core customer base,” Forever 21 co-chief restructuring officer Stephen Coulombe said in a court filing.
