STARTING May 2, a major trade loophole known as the “de minimis” exemption will close.
This will trigger higher costs and potential shipping delays.
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Consumers who shop from global ecommerce platforms like Amazon, Shein, and Temu will see inflated prices due to the “de minimis exemption.”
The exemption, which currently allows packages under $800 to enter the US duty-free, has long benefited companies importing cheap goods from China.
However, those benefits are about to change.
The Trump administration is officially ending the policy at 12:01 a.m. ET on May 2.
This effort aims to collect tariffs on more than a billion packages annually.
More than half of those shipments come from China, which is facing a steep 145% tariff rate.
While President Donald Trump said that rate “will come down substantially” in the future, for now, businesses and consumers alike are bracing for higher costs.
The de minimis rule dates back to 1938 and was initially designed to avoid collecting tariffs on extremely low-value items.
Over time, the value threshold was raised from $1 to $8, then to $200, and finally to $800 in 2015.
The policy became a key pillar of the fast-shipping, low-cost model used by overseas retailers.
Trump initially closed the loophole in February, but delayed the move after packages began piling up.
By April 2, he said the proper systems were in place for the US Customs and Border Protection to enforce new duties on low-value goods.
The White House noted that shippers like UPS and FedEx must now provide detailed customs information, which could result in shipping delays.
Industry experts have warned that this shift will likely raise prices and slow down deliveries.
“This is likely to lead to delivery delays on cheap items,” Juozas Kaziukenas, founder of Marketplace Pulse, told the Associated Press.
UPS has since announced plans to cut 20,000 jobs and shutter 164 facilities by year’s end, citing tariff-related challenges.
Starting May 2, incoming packages from China valued under $800 will face either a 120% tariff or a $100 fee – set to increase to $200 on June 1.
While the rule hasn’t yet gone into effect, Shein and Temu warned customers in mid-April about “price adjustments” set to begin April 25.
A Reuters review found some prices had already doubled since the announcement.
These two Chinese-based platforms alone account for more than 30% of daily de minimis shipments, and many of their customers are already feeling the pinch.
Amazon shoppers aren’t immune, either, however.
About 25% of Amazon’s non-grocery goods are sourced from China, according to Morgan Stanley.
Amazon CEO Andy Jassy said on April 10 that the US-China trade conflict could lead to higher prices across the board.
According to MoffettNathanson Research, Amazon prices rose 4.2% on 50 selected items since April 2.
Some Chinese-sourced orders were reportedly canceled altogether following Trump’s April declaration of “Liberation Day.”
Amazon briefly planned to list tariffs separately next to total product prices but scrapped the idea after Trump criticized it as a “hostile and political act.”
As the May 2 deadline nears, consumers are being urged to expect price hikes, delivery lags, and shifting ecommerce landscapes.