The U.S. administration has ended duty-free imports under $800, known as the “de minimis” exemption, increasing costs for retailers worldwide. President Donald Trump announced the repeal, expanding tariffs on shipments from China and Hong Kong. This decision will impact U.S. buyers and small businesses working with overseas suppliers.

The Trump administration eliminated the de minimis exemption due to concerns about fentanyl trafficking and unfair advantages for foreign e-commerce companies. Retailers like Walmart and Target already reflect tariffs in prices. The exemption previously allowed duty-free cross-border ecommerce, with 1.36 billion shipments valued at $64.6 billion in 2024.

About 73% of de minimis packages entering the U.S. originated from China in 2024. Canada, Mexico, and the UK are other major senders. Since the elimination of the China exemption, de minimis volumes have dropped by a third. Small British businesses have already raised prices to cover duties.

The change has disrupted postal services worldwide, with some pausing shipments to the U.S. British Royal Mail has resumed, offering a “postal delivery duties paid” service. U.S. Customs and Border Protection is implementing the order, increasing paperwork for sellers. Online retailers like Shein and Temu have adjusted since May, with prices starting to rise.

Small businesses struggle to absorb tariffs, leading to planned price increases. Platforms like eBay and Etsy advise sellers to communicate tariff-related price changes. The new tariff regime will impact U.S. customs processes, requiring information on origin and goods in packages.

Read more at Yahoo Finance: Explainer-What the end of the de minimis exemption means for US shoppers and businesses