The United States has reduced the 'de minimis' tariff on low-value parcels from China and Hong Kong to 30% from 145%, following a 90-day trade reprieve between Washington and Beijing, aimed at easing the escalating trade war between the world's two largest economies.
The temporary deal is expected to ease cost pressures on Chinese e-commerce giants like Shein and Temu, which previously benefited from duty-free shipments under the de minimis exemption, but had faced steep tariff hikes earlier this year.
While the United States and China's joint statement following talks in Geneva did not reference de minimis duties, the order signed by U.S. President Donald Trump confirmed a tariff reduction on direct-to-consumer postal shipments.
It said that beginning May 14, levies will drop from 120% to 54% for items valued up to US$800. Additionally, the alternative flat fee of US$100 per package remains in place, while a planned increase to $200 on June 1 has been cancelled.
As part of the temporary 90-day deal between the US and China, the 20% fentanyl-related tariffs imposed by the U.S. president in February and March will remain in place. However, both sides have agreed to reduce "reciprocal tariffs" on each other by 115 percentage points for 90 days.
The United States will temporarily reduce tariffs on Chinese imports from 145% to 30%, while China will lower duties on American goods from 125% to 10%, according to a joint statement.
As part of the agreement, China will also suspend or eliminate certain non-tariff countermeasures imposed since April 2, including export restrictions on select rare-earth minerals and the designation of dozens of U.S. firms on its "unreliable entity list" and "export control list."
Crackdown on "de minimis' shipments
The Trump administration had previously eliminated the "de minimis" exemption, citing concerns over illicit shipments and unfair trade practices.
The exemption has earlier allowed low-value parcels—typically under US$800—to enter the U.S. without duties, fueling a surge in Chinese e-commerce imports.
In an April 2 executive order, Trump justified the removal by stating that Chinese-based shippers were exploiting the loophole to "hide illicit substances and conceal the true contents of shipments sent to the United States through deceptive shipping practices."
While the tariff cut offers temporary relief, policymakers are expected to monitor its impact on trade flows and consumer pricing. The White House emphasized that further negotiations with China could lead to additional adjustments in tariff structures.
Despite the tariff reduction on each other, analysts warned that the new 54% tariffis still a substantial burden compared to the duty-free status that existed before the exemption was revoked.
The U.S. Customs and Border Protection (CBP) reported processing over 1.3 billion de minimis shipments in 2024, with the Chinese commerce companies Temu and Shein accounting for more than 30% of these shipments. It stated that "nearly half" of all de minimis shipments also likely originated from China.
A U.S. Customs and Border Protection official testified before Congress in 2024, stating that the average value of a 'de minimis' shipment in fiscal year 2023 was US$54.
