U.S. Ends De Minimis Trade Exception: A New Era for E-commerce and Global Trade

The de minimis trade exception, which allowed small shipments worth $800 or less to be shipped into the US duty-free, has ended after nearly a century. The provision, intended to ease duty burdens for travelers and makers, became a central pillar of the global e-commerce boom, but President Trump and lawmakers called for its closure. The Biden administration set in motion executive actions to restrict the use of de minimis, and industry groups like the National Council of Textile Organizations lobbied for its end, citing its impact on US manufacturers and the influx of unsafe products.

Starting tomorrow, August 29, one of the most significant changes to online shopping in decades will take effect across the United States. The Trump administration has officially terminated the "de minimis" exemption, a rule that allowed low-value imports to enter the country duty-free. This exemption, established in 1938 and raised to $800 in 2016, has been a cornerstone of international e-commerce, but its scope has expanded dramatically with the rise of e-commerce.

The termination of the de minimis exemption will impact a wide range of products commonly imported in small quantities, including clothing and accessories, beauty and cosmetics products, household items, electronics, toys, and specialty products. American consumers can expect additional fees on top of the product price due to the tariffs imposed by the Trump administration. For packages shipped by companies like FedEx, UPS, or DHL, the full tariff rate based on the country of origin will apply, ranging from 5% to 50%. For packages shipped through regular mail, consumers can choose between a percentage-based tariff or a flat fee, with flat fees ranging from $80 to $200 per package for the next six months.

Over 25 countries have already suspended mail service to the United States due to the new tax requirements, including many European and Asian nations. Major discount platforms like Shein and Temu have already faced these changes earlier in 2025 when the exemption ended for China in May. Now, companies like Amazon, Etsy, Shopify, TikTok, Instagram, and many specialty stores will be affected.

The Trump administration argued that the old system was being abused, with over 90% of all packages entering the US using the exemption to avoid paying proper taxes. However, these taxes are not paid by the importing country but rather by American businesses and ultimately American consumers. As a result, American consumers can expect items priced at 20-60% more and shipping delays as customs processes more packages.

The end of the de minimis exemption is expected to lead to higher costs and possible supply disruptions for consumers. Ernie Tedeschi, director of economics at Yale Budget Lab, previously told USA TODAY that prices at big-name stores like Target, Walmart, and Costco won't be immediately affected, as these stores have already been hit by tariff increases. However, shoppers may see disruptions in availability or stock before noticing price hikes.

The termination of the de minimis exemption is part of a broader effort by the Biden administration to restrict the use of the exemption and address concerns about its impact on US manufacturers and the influx of unsafe products. Industry groups like the National Council of Textile Organizations have lobbied for its end, citing these concerns.

In conclusion, the end of the de minimis trade exception will have significant implications for global e-commerce and US consumers. While the long-term effects remain to be seen, it is clear that the termination of this exemption will lead to higher costs and potential disruptions in the supply chain.

References:
[1] https://mahometdaily.com/trump-administration-ends-de-minimis-trade-exemption-triggering-global-shipping-disruption/
[2] https://www.usatoday.com/story/money/2025/08/29/de-minimis-exemption-end/85888111007/