The US proposal to eliminate de minimis for commercial shipments from all nations by 2027 has received support from the National Council of Textile Organisations (NCTO) in the United States.
In the budget reconciliation measure, the US House Ways & Means Committee, the House of Representatives’ main tax-writing committee, includes a clause that would permanently remove the de minimis entry privilege for commercial shipments.
Shipments valued under US $ 800 that are headed for US consumers and businesses were allowed entry into the US free of tariffs and taxes under Section 321 of the Tariff Act of 1930. As of 2nd May, the clause was removed for products coming from China, including Hong Kong and Macau, however it still applies to imports from other countries.
With effect from 1st July 2027, the most recent provision eliminates the de minimis privilege globally. Additionally, it said that this section stiffens the penalties for those who violate Section 321 of the 1930 Tariff Act.
Popular Chinese shopping sites and other e-tailers who ship packages straight from the factory to individual customers would benefit from President Donald Trump’s executive order that lowers new 145 per cent tariffs on Chinese goods to 30 per cent for 90 days. Following the US government’s 2nd May decision to remove duty-free treatment for low-value goods and subject them to the same tariffs applied to all Chinese products, e-commerce orders and air freight shipments fell precipitously.
Prior to this, a person could employ an informal entry process and import products worth US $ 800 or less each day under US trade law. The regulation encouraged direct-to-consumer cross-border shipping from Chinese e-commerce sites. China is the source of around two-thirds of all packages that enter the nation via the de minimis channel.
Additionally, proactively reducing taxes for low-value packages from China delivered via the international postal system was another goal of the executive order. Previously subject to a 120 per cent duty, postal shipments under US $ 800 are now subject to a 54 per cent tariff. Instead, carriers might choose to pay US $ 100 for each mail package that contains products. A 1st June hike to US $ 200 for the flat fee was cancelled by Monday’s order.
In December, the US-China Economic and Security Review Commission suggested that Congress remove the de minimis eligibility requirement for imports that are offered on internet marketplaces.
According to US customs data, the use of the de minimis exemption increased by more than 600 per cent, from around 139 million shipments in fiscal year 2015 to more than 1 billion shipments yearly in 2023. Shipments coming in under de minimis totalled 1.36 billion in 2024.
Lower de minimis levels for gifts and personal belongings carried into the US are maintained by the proposed legislation. It also establishes sanctions of US $ 5,000 for first offences and US $ 10,000 for repeat offences for the abuse of de minimis prior to this deadline to import products in violation of US regulations.
“On behalf of the United States textile industry, we would like to commend the House Ways and Means Committee for including an important and critical provision in the broader budget reconciliation bill that would permanently end de minimis access for commercial shipments from all countries, effective 1st July 2027,” stated Kim Glas, president and CEO of the NCTO.
“Given its substantial harm to producers, retailers, and the fight against fentanyl and other illegal products, we firmly support a more aggressive timeframe to enact a permanent ban on de minimis globally as the measure moves through the legislative process,” said Glas, adding, “Express shippers have already made the shift to processing all Chinese imports through sophisticated logistics systems, demonstrating their ability to comply with the president’s executive orders and pivot quickly.”
