The end of de minimis exemption is disrupting global trade

The de minimis exemption ended yesterday, eliminating duty-free imports of goods valued under $800. Now, any item below $800 entering the US will be taxed like all other imports.

The executive order accelerates the exemption’s end, originally planned for 2027, citing misuse for tariff evasion and the sale of unsafe products.

The change affects shipments from companies like Tapestry, Lululemon, Shein, Temu, and nearly all online retailers that previously saw their shipments enter the US with minimal oversight.

Global supply chains in chaos
Businesses and postal services worldwide are scrambling to comply with these regulations. Supply chains from France to Singapore have been snarled, and post offices have temporarily suspended shipments. 

Companies built operations around bonded warehouses and single-item shipments, but now face tariffs, operational hurdles, and compliance risks. 

Analysts warn the change could cost US consumers $10.9 billion annually—about $136 per family—disproportionately affecting low-income and minority households.

Retailers adjust
Major companies, such as Tapestry, estimate a $160 million hit to profits, while Lululemon faces $0.90–$1.10 per share earnings pressure. 

Online marketplaces like Etsy and eBay anticipate higher costs, shipping delays, and reduced selection. 

Meanwhile, Amazon and Walmart may gain market share through domestic fulfillment networks. Shein and Temu have already raised prices and shifted US operations in response.