THE END OF SHEIN AND TEMU? TRUMP ATTACKS CHEAP ONLINE SHOPPING MODEL

Do you usually shop on digital platforms such as Shein, Temu, AliExpress, among others? If your answer was yes, was your consumption affected by the imposition of tariffs on shipping? This happened because the U.S. government, led by the current president Donald Trump, put an end to the de minimis exemption.

Which users and companies were affected, what did the increase consist of, and will these tariffs remain in force? Stay tuned to continue reading about the elimination of de minimis.

A little about its history

The term “minimis” refers to matters of little importance. Its origin dates to 1930, where it was known as Section 321 of the Customs Act of 1930. It was created with the aim of avoiding complications for tourists who wanted to take souvenirs home and was later maintained with the aim of reducing the administrative burden for customs.

However, with the rise of e-commerce, it has become amassive export channel for low-value imports from China to the United States. U.S. manufacturers and retailers feel that this exemption has become a threat to the domestic market and local production.

This “minimis” exemption in legal terms refers to exemption from certain standard customs procedures and tariffs. This rule allowed all shipments with a value of less than 800 dollars that were destined for final consumers or small businesses to enter the United States without paying duties or complying with standard customs requirements. Importantly, the U.S. minimis exemption was one of the most generous, as the EU minimis threshold is 150 euros.

What happened?

In February, Donald Trump ended the minimis exemption for products originating from China and Hong Kong, and although for now this measure was imposed only for these two Asian countries, President Trump indicated that he intends to extend it to more countries.

The executive order was signed on April 2, coming into effect on May 2 setting a tax of 120% of the value of the package, or a flatrate of 100 dollars per package, which would increase to 200 dollars per package as of June 1, 2025.

The causes for the elimination of the exemption are due to several reasons. Among the main ones we find the trade war between the United States and China, coupled with concerns about unfair competition that was generating the importation of low-value products without payment of taxes and tariffs mainly from companies such as Temu, Shein and AliExpress.

Who was affected?

It mainly affected millions of lower-class Americans who consumed these low-value Chinese products as a solution to their needs.

However, the parcel sector was one of the hardest hits. In 2024, Customs and Border Protection (CBP) processed more than 1.3 billion of minimis shipments, which decreased in response to the tariff increase.

Parcel carriers such as UPS have announced that they will close more than 70 facilities and cut more than 20,000 jobs as demand forlast-mile shipments dropped dramatically.

Donald Trump is in a 90-day “truce” period with the Asian giant, so he reduced tariffs during this period as follows:

     - U.S. will reduce tariffs in China from 145% to 30%.

     - Shipments of goods with a value of less than 800 dollars have had the rate cut from 120% to 54%.

     - The tariff of 100 dollars per package remains inplace, but the planned increase to 200 dollars on June 1 was cancelled.

     - For its part, China will lower import duties to the United States from 125% to 10%.

In summary, like any tariff barrier that seeks to protect the domestic market and its industry, it affects not only the country against which it is being protected, but also certain sectors of the same country.