Topic: De Minimis

The U.S. has ended the $800 duty-free "de minimis" exemption for international parcels, leading to increased paperwork and higher costs for consumers. A listener reports paying nearly double the price for a Chinese joystick part due to new tariffs and fees. The hosts also warn of Instagram scams where sellers claim to be going out of business to lure buyers into purchasing low-quality goods from China.

The U.S. government has lowered the "de minimis" tariff exemption from $800 to $100, impacting low-value imports from companies like Temu and Shein. The $800 threshold was originally established in 2015 under the Trade Facilitation and Trade Enforcement Act. The change has caused confusion among European postal services, leading some to temporarily suspend shipments to the United States.

TikTok informed its sellers that the "de minimis" exemption for packages under $800 from China will be removed in May 2025, potentially crippling the platform's e-commerce model. Meanwhile, Amazon's CEO denied reports of a bid for TikTok, focusing instead on the company's expansion into home drug delivery.

An executive order set for May 2nd will close the "de minimis" loophole that allowed shipments under $800 from China and Hong Kong to enter the U.S. duty-free. This change targets e-commerce giants like Temu and Shein, which ship roughly 4 million packages daily. Proponents of the order argue it will curb the flow of illegal fentanyl and address unfair competition for U.S. textile manufacturers.

Congressional testimony highlights a significant gap in U.S. Customs oversight, as 43% of import value arrives via air or land where data is not publicly published. The "de minimis" loophole allows over two million packages a day to enter the U.S. from China without meaningful inspection, potentially facilitating the entry of fentanyl and goods produced by forced labor. One host recounts personal experience with the surprisingly low cost of air shipping from China compared to other regions.