New Tariffs on Overseas Imports: What You Need to Know About the 'De Minimis' Loophole Closure

Starting Friday, the US will no longer exempt low-cost imports worth $800 or less from duties. Online shoppers from overseas merchants will face a 10 to 50% levy or a flat rate of $80 to $200 per package. This change comes after President Donald Trump's July 30 executive order. The move aims to make online shopping from overseas merchants more complicated and expensive.

Starting Friday, the United States will no longer exempt low-cost imports worth $800 or less from duties. This change, part of President Donald Trump's July 30 executive order, aims to make online shopping from overseas merchants more complicated and expensive. The move will subject merchandise to a 10 to 50 percent levy depending on the tariff rate of the country of origin, or a flat rate of $80 to $200 per package [1].

The de minimis exemption, which started in 1938, has been a widely used customs exemption for international shipments. However, it has been criticized for being exploited by foreign businesses to evade tariffs and by criminals to smuggle contraband into the U.S. [1]. The Trump administration argues that the exemption has become a loophole that needs to be closed.

The impact of this change is expected to be significant. Online shoppers from overseas merchants will face higher costs, potentially leading to reduced spending on international goods. Small businesses that rely on imported products and materials may also be affected. For instance, Kristin Trainor, owner of a boutique in Connecticut, estimates that a simple linen sundress that cost $30 wholesale will rise to $43 next month due to the added customs and duty charges [1].

Moreover, the change may lead to temporary suspensions in package delivery from several countries. The national postal services of more than a dozen countries have said they would pause shipments due to confusion over processing and payment requirements [1].

In response to the change, DHL has expanded its international shipping services on Shopify for U.S. merchants. This integration offers cost-effective international shipping solutions, including Delivered Duty Paid (DDP) and Delivered Duty Unpaid (DDU) services, allowing merchants to choose whether to collect duties and taxes from customers at checkout or have them pay at the time of delivery [3].

While the new policy aims to address the exploitation of the de minimis exemption, it is crucial to monitor its impact on both consumers and businesses. The changes may lead to increased costs for online shoppers and small businesses, potentially affecting their spending and operational costs, respectively. However, it could also help close loopholes and reduce the smuggling of contraband into the U.S.

References:
[1] https://www.newsmax.com/finance/streettalk/de-minimis-exemption-end/2025/08/26/id/1223960/
[2] https://www.washingtonpost.com/business/2025/08/28/de-minimis-expiration-shipping-prices-consumers/
[3] https://www.morningstar.com/news/pr-newswire/20250825fl57324/dhl-expands-its-international-shipping-services-on-shopify-for-us-merchants