U.S. President Donald Trump signed an order on Wednesday to close a trade rule called “de minimis.” This rule allowed cheap products from China and Hong Kong (worth less than $800) to enter the U.S. without paying taxes.
The new rule starts on May 2 at 12:01 a.m. Eastern Time. Now, these low-cost packages must pay import taxes. Shipments through the postal system will be taxed at 30% of their value or $25 per item. After June 1, this will increase to $50 per item.
Why Did Trump Do This?
Too Many Duty-Free Packages: Last year, 1.4 billion packages entered the U.S. tax-free, and 60% were from China.
Unfair Competition: Retailers like Temu and Shein used this rule to avoid import duties, hurting American businesses.
Drug Concerns: U.S. officials claim that drug traffickers used this rule to smuggle chemicals for making fentanyl, a dangerous drug.
What’s Changing?
All shipments under $800 from China and Hong Kong will now be taxed.
Postal packages will pay 30% tax or $25 per item (rising to $50 per item after June 1).
Shipping companies must report package details to U.S. Customs and pay the required taxes.
Trump had paused this rule in February because officials needed time to prepare for inspections, but now they are ready.
The Commerce Department will review these changes in 90 days and might expand them to include Macau.
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