President Donald Trump Cuts the De Minimis Tariff The de minimis loophole affects pricing on purchases from low-cost retailers like Temu and Shein.
By Erin Davis Edited by Sherin Shibu
On Monday, the White House announced that after meeting with China last weekend, the two countries agreed to cut the high tariffs on each other's goods. The reductions are a pause of 90 days "while talks continue," according to the statement.
The Trump Administration said that the United States and China will "each lower tariffs by 115% while retaining an additional 10% tariff," while other measures remain in place. The deal goes into effect on or before May 14, 2025.
However, Reuters noted that the de minimis loophole, which ended on May 2, was initially left out of the deal, and language surrounding the provision had been "absent."
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The rule, which has been around since the 1930s, previously allowed packages worth less than $800 to be sent to the U.S. duty-free, allowing low-price, online retailers like Temu and Shein to sell items cheaper than products made in the U.S.
But later on Monday, the Trump administration announced an executive order that also cuts tariffs on the low-price packages under the de minimis loophole from China to 54%, down from 120%.
According to U.S. Customs and Border Protection Agency data, the U.S. processed more than 1.3 billion de minimis shipments in 2024 worth more than $48 billion. For comparison, 10 years ago in 2015, that number was 139 million.
Trade talks are ongoing, the White House notes.
