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4d ago

U.S. Ends Duty-Free Imports for Chinese Goods, Triggering Price Hikes and Supply Chain Shifts

The removal of the de minimis exemption imposes tariffs of up to 145% on Chinese imports, driving up costs for consumers and forcing businesses to adapt or exit the U.S. market.

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Shein and Temu app icons are seen in this illustration taken August 22, 2024. REUTERS/Dado Ruvic/Illustration/File Photo

Overview

  • The de minimis exemption, allowing duty-free imports under $800, officially ended at 12:01 a.m. ET on May 2 for goods from China and Hong Kong.
  • Chinese imports via private carriers now face tariffs as high as 145%, while USPS shipments are subject to 120% tariffs or flat fees, set to increase in June.
  • Major e-commerce platforms like Shein and Temu have raised prices, with some items doubling or tripling in cost, while smaller retailers are halting U.S. shipments.
  • Ports and carriers report steep declines in cargo volumes, with sailings from China to the U.S. dropping 60% in April and significant impacts anticipated for local economies and jobs.
  • Lower-income U.S. households, which disproportionately relied on duty-free Chinese goods, are facing reduced options and higher costs for everyday products.