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In the last decade, companies like Shein and Temu have taken advantage of loopholes in U.S. import law to bring tons of low-cost goods into the country while paying little in taxes. It’s part of what has helped these companies grow to be billion-dollar businesses. But a new Biden administration plan, announced last week, seeks to end that practice.
The de minimis exemption is a ruling in U.S. import law established at the beginning of the 20th century that eliminates duties and taxes for imports below a certain price threshold. Originally, that was just $200, but it was raised to $800 in 2016. The administration said that, in the last 10 years, the number of annual shipments entering the country that were under the set limit increased from 140 million to over 1 billion.
The administration plans to issue an executive order prohibiting items that are subject to certain tariffs from meeting the de minimis exemption. The rule would exclude roughly 70% of textile and apparel shipments coming from China, many of them from brands like Shein or Temu. The administration also urged Congress to pass more sweeping reforms to import taxation next year.
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English (US) ·