The administration of US President Donald Trump on Friday ended the de minimis exemption on small packages being shipped to the US from abroad, saying that closing the "loophole" was necessary to cut the flow of narcotics into the country. Packages valued at or under $800 had previously been allowed to enter the US duty-free in an effort to foster small business growth.
29/08/2025 -
By: FRANCE 24
File photo: A person walks out of a US Post Office on April 1, 2024 in Montclair, California. © Mario Tama, Getty Images via AFP
The United States on Friday ended tariff exemptions on small packages entering the country from abroad, in a move that has sparked concern among small businesses and warnings of consumer price hikes.
President Donald Trump's administration cited the use of low-value shipments to evade tariffs and smuggle drugs in ending duty-free treatment for parcels valued at or under $800.
Instead, packages will either be subject to the tariff level applicable to their country of origin, or face a specific duty ranging from $80 to $200 per item. But exclusions for some personal items and gifts remain.
Trump's trade adviser Peter Navarro told reporters that closing this "loophole" helps restrict the flow of "narcotics and other dangerous and prohibited items" while bringing fresh tariff revenues.
"This is a permanent change," a senior administration official said, adding that any push to restore the exemptions for trusted trading partner countries was "dead on arrival". The de minimis exemption has been in place since 1938, starting at $5 for gift imports and was raised from $200 to $800 in 2015 as a means to foster small business growth on e-commerce marketplaces.
But direct shipments from China exploded after Trump raised tariffs on Chinese goods during his first term, creating a new direct-to-consumer business model for e-commerce firms Shein and Temu.
Postal services, including in France, Germany, Italy, India, Australia and Japan, earlier said most US-bound packages would no longer be accepted.
Read moreFrench suspension of US package deliveries over tariffs comes into effect
The UK's Royal Mail, which took a similar step, announced new services Thursday for customers to continue sending goods to the United States.
On Tuesday, the United Nations' Universal Postal Union said 25 member countries' postal operators had suspended outbound postal services to the country.
"Foreign post offices need to get their act together when it comes to monitoring and policing the use of international mail for smuggling and tariff evasion purposes," Navarro added Thursday.
US officials maintain that just five percent of duty-free small package shipments arrived via the postal network, while most went through express couriers.
The National Coalition of Textile Organizations called the move a "historic win" for US manufacturing by closing a loophole that allowed foreign fast-fashion firms to avoid tariffs and import apparel sometimes made with forced labour, undercutting American jobs.
"The administration’s executive action closes this channel and delivers long overdue relief to the US textile industry and its workers," the group said.
CBP has estimated that the number of packages claiming the de minimis exemption jumped nearly 10-fold from 139 million in fiscal 2015 to 1.36 billion in fiscal 2024 – a rate of nearly 4 million per day.
But the impending change has brought confusion and concern to small businesses.
Delays, cost hikes
UK retailer Liz Nieburg told AFP she had stopped shipping products to US customers while the Royal Mail worked out a system to honour the changes.
US buyers form about 20 percent of sales at her online business SocksFox, which sells socks, undergarments and sleepwear.
She sees little choice but to hike prices if new duties are here to stay: "Our margins are too tight to be able to absorb that."
The Trump administration has imposed tariffs in rapid succession this year.
Cornell University professor Li Chen warned that it takes time for postal services to establish systems for duty collection: "It's not like there's a switch you can turn on and turn off."
"On the consumer side, there will be potential delays, because now all the parcels have to clear customs," Chen added. Prices may also rise if businesses pass on the tariffs.
Read moreStunned by Trump’s tariffs, world clothing suppliers are preparing to squeeze workers
He expects the impact on small businesses to be "much greater", as larger firms can absorb shocks.
These include businesses like Chinese-founded consumer platforms Shein and Temu, which were hit when Washington ended the exemption for China-origin products this year.
They might have to raise costs, Chen said, but they are not fully dependent on US consumers.
Ken Huening, whose California-based business CoverSeal manufactures outdoor protective covers in China and Mexico, has had to eliminate free shipping for customers.
While he had benefited from the duty-free exemption, the hit to China and now Mexico is posing challenges.
"Textile and manufacturing is not available in the US currently," Huening said. "It might be in the future, but by that time, we're all out of business."
Confusion
"It's a super confusing time for our customers," said Haley Massicotte, who runs Canada-based cleaning products company Oak & Willow.
She said US consumers do not always understand how tariffs work, and how they might have to bear added costs.
"We are going to do everything in our power to not raise prices," she stressed.
Similarly, ceramics retailer Sarah Louise Jour in Bangkok is trying to keep shipping costs down after facing issues with Thailand's postal service.
This forced her to tap more expensive services for shipments to US buyers, constituting some 90 percent of her business.
"I don't have time to worry, because I have to think about my team," she said. "I have rent I need to pay for the office."
While she expects sales to hold up over the holidays, the outlook is murkier afterwards.
Massicotte said: "This tariff war is just going to hurt the American and the Canadian consumer, especially small business owners."
(FRANCE 24 with AFP and Reuters)
The United States on Friday ended tariff exemptions on small packages entering the country from abroad, in a move that has sparked concern among small businesses and warnings of consumer price hikes.
President Donald Trump's administration cited the use of low-value shipments to evade tariffs and smuggle drugs in ending duty-free treatment for parcels valued at or under $800.
Instead, packages will either be subject to the tariff level applicable to their country of origin, or face a specific duty ranging from $80 to $200 per item. But exclusions for some personal items and gifts remain.
Trump's trade adviser Peter Navarro told reporters that closing this "loophole" helps restrict the flow of "narcotics and other dangerous and prohibited items" while bringing fresh tariff revenues.
"This is a permanent change," a senior administration official said, adding that any push to restore the exemptions for trusted trading partner countries was "dead on arrival". The de minimis exemption has been in place since 1938, starting at $5 for gift imports and was raised from $200 to $800 in 2015 as a means to foster small business growth on e-commerce marketplaces.
But direct shipments from China exploded after Trump raised tariffs on Chinese goods during his first term, creating a new direct-to-consumer business model for e-commerce firms Shein and Temu.
Postal services, including in France, Germany, Italy, India, Australia and Japan, earlier said most US-bound packages would no longer be accepted.
Read moreFrench suspension of US package deliveries over tariffs comes into effect
The UK's Royal Mail, which took a similar step, announced new services Thursday for customers to continue sending goods to the United States.
On Tuesday, the United Nations' Universal Postal Union said 25 member countries' postal operators had suspended outbound postal services to the country.
"Foreign post offices need to get their act together when it comes to monitoring and policing the use of international mail for smuggling and tariff evasion purposes," Navarro added Thursday.
US officials maintain that just five percent of duty-free small package shipments arrived via the postal network, while most went through express couriers.
The National Coalition of Textile Organizations called the move a "historic win" for US manufacturing by closing a loophole that allowed foreign fast-fashion firms to avoid tariffs and import apparel sometimes made with forced labour, undercutting American jobs.
"The administration’s executive action closes this channel and delivers long overdue relief to the US textile industry and its workers," the group said.
CBP has estimated that the number of packages claiming the de minimis exemption jumped nearly 10-fold from 139 million in fiscal 2015 to 1.36 billion in fiscal 2024 – a rate of nearly 4 million per day.
But the impending change has brought confusion and concern to small businesses.
Delays, cost hikes
UK retailer Liz Nieburg told AFP she had stopped shipping products to US customers while the Royal Mail worked out a system to honour the changes.
US buyers form about 20 percent of sales at her online business SocksFox, which sells socks, undergarments and sleepwear.
She sees little choice but to hike prices if new duties are here to stay: "Our margins are too tight to be able to absorb that."
The Trump administration has imposed tariffs in rapid succession this year.
Cornell University professor Li Chen warned that it takes time for postal services to establish systems for duty collection: "It's not like there's a switch you can turn on and turn off."
"On the consumer side, there will be potential delays, because now all the parcels have to clear customs," Chen added. Prices may also rise if businesses pass on the tariffs.
Read moreStunned by Trump’s tariffs, world clothing suppliers are preparing to squeeze workers
He expects the impact on small businesses to be "much greater", as larger firms can absorb shocks.
These include businesses like Chinese-founded consumer platforms Shein and Temu, which were hit when Washington ended the exemption for China-origin products this year.
They might have to raise costs, Chen said, but they are not fully dependent on US consumers.
Ken Huening, whose California-based business CoverSeal manufactures outdoor protective covers in China and Mexico, has had to eliminate free shipping for customers.
While he had benefited from the duty-free exemption, the hit to China and now Mexico is posing challenges.
"Textile and manufacturing is not available in the US currently," Huening said. "It might be in the future, but by that time, we're all out of business."
Confusion
"It's a super confusing time for our customers," said Haley Massicotte, who runs Canada-based cleaning products company Oak & Willow.
She said US consumers do not always understand how tariffs work, and how they might have to bear added costs.
"We are going to do everything in our power to not raise prices," she stressed.
Similarly, ceramics retailer Sarah Louise Jour in Bangkok is trying to keep shipping costs down after facing issues with Thailand's postal service.
This forced her to tap more expensive services for shipments to US buyers, constituting some 90 percent of her business.
"I don't have time to worry, because I have to think about my team," she said. "I have rent I need to pay for the office."
While she expects sales to hold up over the holidays, the outlook is murkier afterwards.
Massicotte said: "This tariff war is just going to hurt the American and the Canadian consumer, especially small business owners."
(FRANCE 24 with AFP and Reuters)
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