Trump suspends trade loophole for cheap online retailers globally
E-commerce giants everywhere felt the sting Wednesday when President Donald Trump announced that the US will be "suspending duty-free de minimis treatment for low-value shipments" worth $800 or less from anywhere in the world.
Americans will likely soon feel the crunch, with one recent study estimating that the cost of eliminating the trade loophole overall to US consumers could fall between $10.9 billion and $13 billion while "disproportionately" hurting "lower-income and minority consumers" who buy a higher percentage of cheap imports.
Price hikes will likely come this fall, as the trade loophole will be closed starting on August 29, with Amazon emerging as perhaps the biggest question mark for US consumers wondering how hard their wallets may be hit by the major trade policy change ahead of the holiday shopping season.
Earlier this year, Trump ended the de minimis exemption for all imports from China. That led China-based retailers Temu and Shein to confirm they would be raising prices on their platforms in April. More recently, a Reuters investigation found that Shein prices on hundreds of items in July crept to their highest increases yet, on average charging shoppers about 23 percent more for clothing, "with cheaper items seeing bigger percentage increases than the higher priced ones." That example seems to support economists' forecast that eliminating the exemption risked flipping US trade policy "from pro-poor to pro-rich."
