(NewsNation) — A special exemption that prevented tariffs from being imposed on low-value packages from China expired overnight Friday.
Until Friday, the de minimis exemption allowed packages under $800 to come into the United States, mostly from China, duty-free. President Donald Trump called the loophole “a big scam.”
The exemption’s exit will raise prices and delay delivery times for millions of packages daily.
The rule was created because sometimes processing a tariff fee on those small packages would cost more than the package itself.
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But as trading tensions have grown between Trump and China, the president has decided to do away with the exemption altogether.
Last month, he signed an executive order eliminating the duty-free treatment for Chinese packages. The order claims opioids like fentanyl, or the ingredients to make it, enter the U.S. through this exemption.
Now, qualifying postal items will be subject to either a 30% duty or a $25 fee per item. That fee will increase to $50 per item in June, per the White House.
“De minimis, it’s a big deal. It’s a big scam going on against our country, against, really, small businesses. We’ve ended it. We’ve put an end to it,” Trump said at Wednesday’s Cabinet meeting.
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Concerns over China’s exploitation of the loophole aren’t new.
Last fall, President Joe Biden announced restrictions on what was eligible after both moderate and progressive House Democrats penned a letter urging Biden to end the practice they said exposes “American consumers to great risk by flooding the market with fake and sometimes dangerous imported goods.”
But for small businesses that make their products here in the U.S. using items from China, the end of the exemption is another reason things could get more expensive for consumers.
