The long-debated $800 de minimis exemption is officially coming to an end! On February 1, former President Donald Trump signed new executive orders introducing major trade policy changes:
✅ A 10% tariff on imports from China✅ A 25% tariff on imports from Canada & Mexico
✅ ❌ Removal of the $800 duty-free exemption for small parcels, effective February 4 at 12:01 AM ET
Impact on Global Trade
This policy shift will have profound effects on cross-border e-commerce and global supply chains:
🔹 Challenges for Chinese E-commerce Platforms
Popular platforms like TEMU, SHEIN, and TikTok Shop will face higher costs, reduced margins, and potential loss of price competitiveness.
🔹 End of Ultra-Low-Cost Pricing Models
Logistics reliant on small-package shipments from hubs like Yiwu and Huaqiangbei will become less viable, affecting many low-cost suppliers.
🔹 Dropshipping Business at Risk
Sellers relying on a low-price, high-volume model will struggle with the increased costs, pushing them to reconsider their business strategies.
🔹 Logistics Industry Shake-Up
The decline of direct small-parcel shipping could lead to a rise in bulk imports, consolidation centers, and overseas warehouses to optimize costs.
Why Is Trump Doing This?
📈 Boost U.S. Tax Revenue
Previously, billions of dollars in imports entered duty-free, reducing potential tax income.
🌟 Support Domestic Manufacturing
This move is part of a broader effort to revitalize U.S. industries by making foreign goods more expensive.
🚫 Combat Illicit Trade
The policy aims to curb smuggling, particularly targeting counterfeit and illicit goods entering through small parcel shipments.
What’s Next?
While this change presents a major challenge for cross-border sellers, China’s supply chain advantages remain strong. Businesses will adapt, and new models will emerge in response to these regulatory shifts.
💡 How will your business navigate this shift? What strategies will you implement? Join the conversation below! 👇