Latest news with #InternationalEmergencyEconomicPowersAct
Yahoo
2 hours ago
- Business
- Yahoo
Trump Issues Executive Order Ending De Minimis Exemption
President Donald Trump on Wednesday signed an executive order 'closing the catastrophic loophole' known as the de minimis trade exemption to small commercial shipments from across the globe, building upon a ban issued on China-originating shipments in May. Effective Aug. 29, shipments worth $800 or less making their way into the United States through channels other than the international postal network will be subject to 'all applicable duties,' the White House wrote in a memo. More from Sourcing Journal Trump Slaps India, a 'Friend' to the US, With 25% Tariffs Tariffs Hurt Footwear, Apparel Growth, Says Moody's Trump Administration's DOJ Primed to Tackle Tariff Evasion With New Unit Small parcels shipped through the international postal system will instead see duties assessed through one of two methodologies. Most packages will pay ad valorem duties equal to the tariff rates imposed under Trump's International Emergency Economic Powers Act (IEEPA) tariffs. Meanwhile, some packages will be subject to specific duties ranging from $80-$200 per item, depending on the effective IEEPA rate of the country of origin. This methodology for determining tariffs will only be available for six months, after which shipments must comply with the ad valorem model. Trump said the action will put an end' to the 'big scam' perpetuated by Section 321, which has allowed large volumes of foreign-made goods (to the tune of 1.36 billion shipments in 2024) into the country duty free. Cauterizing the fatal wound to de minimis, the president's Big Beautiful Bill, signed into law last month, will permanently repeal the statutory basis for the trade provision globally beginning on July 1, 2027. This week's move represents a logical next step for the administration after it closed the de minimis exemption to shipments from China more than two months ago, imperiling the business models of fast fashion titan Shein and global e-commerce marketplace Temu and cutting off shoppers' access to impossibly cheap wares. The change has impacted global shippers like UPS, which this week released second-quarter insights revealing a sharp contraction in parcel shipping, especially for smaller packages. In an earnings call Tuesday, CEO Carol Tomé said trade policy shifts had prompted a 34.8-percent volume decline in packages traveling from China to the U.S. between May and June. Apparel imports from China fell to a 22-year low in May, with the country's share of American apparel sourcing to dropping below 10 percent for the first time in decades following the administration's de minimis announcement on May 2. Shoppers and businesses reliant on the duty-free exemption are lamenting its demise—and even taking the president to court over it. But the National Council of Textile Organizations (NCTO), which represents U.S. textile and apparel manufacturers, has been a longtime proponent of de minimis reform due to a perspective that the deluge of low-value imports is undercutting American makers. The group's president and CEO, Kim Glas, commended Trump for leveraging his presidential authority on the matter. 'For eight years, NCTO has led critical efforts to close the de minimis backdoor pipeline for cheap, subsidized, and often illegal, toxic and unethical imports—half of which are estimated to be textiles and apparel,' she said, placing the estimate at 4 million packages per day. 'The de minimis mechanism has functioned as a black box for low-cost, subsidized, and unethical Chinese imports and undermined the competitiveness of the U.S. textile industry—a key contributor to the workforce and the U.S. economy,' she added. According to Glas, Wednesday's executive order 'restores fairness for U.S. manufacturers, closes a major gateway for illegal and toxic goods, and lays the groundwork for reinvestment and job creation here at home.' Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 hours ago
- Business
- Yahoo
Tariff Ticker: Trump Scores Victory in De Minimis Challenge, But No Deal With China Yet
The U.S. Court of International Trade (CIT) has declined for now to block President Donald Trump's executive orders ending the de minimis trade exception for shipments valued at $800 or less—a victory for the administration amid a number of challenges to its authority on issues of trade. On Monday, a panel of three judges handed a tentative victory to the president in a case brought by Michigan-based Detroit Axle, a supplier of car parts like brake rotors and wheel bearings. In its complaint, the company challenged the legality of Trump's decision to end the longstanding trade provision, which has allowed it to import small shipments of goods from China that it said are essential to its business. As a result of Trump's trade actions, the company announced last week that it would close one of its regional warehouses, imperiling the jobs of 102 employees. More from Sourcing Journal Trump Administration's DOJ Primed to Tackle Tariff Evasion With New Unit UPS China-to-US Shipments Decline More than Expected in Q2 China Inks $65.5M in Textile Projects for Egypt's SCZone Detroit Axle sought, and was denied, a motion for a preliminary injunction against the kibosh on de minimis. The judges ruled that the scope of the lawsuit is already being addressed in another lawsuit challenging Trump's 'reciprocal' tariffs. 'We will not grant redundant, contingent relief through a preliminary injunction here,' the decision read. In the other case, which was brought by a number of U.S. businesses in May, the CIT ruled against the president's imposition of duties under the International Emergency Economic Powers Act (IEEPA), saying that he'd overstepped his authority in leveraging the little-known trade law to justify sweeping tariffs on trade partners. Shortly after the decision, however, the administration requested a stay of the injunction with the U.S. Court of Appeals for the Federal Circuit (CAFC) and was granted a temporary stay. As a result, the IEEPA tariffs are able to move forward while the legal proceedings play out. The appeals court is slated to hear oral arguments on the case Thursday morning, one day before the pause on worldwide duties expires. With that deadline looming, the administration has been firing off letters to foreign trade partners and expediting handshake deals with a number of ASEAN nations, along with Japan. Most recently, the president touted a deal with the European Union, announced Sunday from Scotland with European Commission President Ursula von der Leyen, wherein the 27-member trade bloc will pay 15-percent duties on about 70 percent of the volume of goods imported into the U.S. market. Far from satisfied, many European leaders had hoped for a lower rate, and now shippers are pushing for details that remain scant. Meanwhile, cabinet members including U.S. Trade Representative (USTR) Ambassador Jamieson Greer and Treasury Secretary Scott Bessent met with Chinese trade officials in Stockholm this week, concluding negotiations Tuesday without formalizing a path forward for the trade relationship after weekend speculation that a deal could be forthcoming. China and the U.S. in May agreed to a bilateral pause on retaliatory tariffs that would last for 90 days, with an end date of Aug. 12. While there was no formal agreement to extend the pause and continue talks, Bessent attempted to quell anxieties that the truce was disintegrating. 'Just to tamp down that rhetoric, the meetings were very productive,' Bessent said, according to CNN. 'We just haven't been given that signoff,' he added, referring to approval from Trump. Greer also said a 'potential pause' was on the table, should the Commander in Chief approve it. Trump himself added Tuesday that he felt the meetings had been positive, and said he aims to meet with Chinese President Xi Jinping before the end of 2025. The president didn't espouse such a rosy outlook with regard to one of the country's other biggest trading partners, however. Despite a close relationship with India's prime minister, Narendra Modi, Trump said Tuesday that he plans to slap the country with 25-percent tariffs on Friday should Washington and New Delhi fail to reach a consensus. On 'Liberation Day' in April, Trump threatened India with 26-percent duties. He didn't offer an explanation for the adjustment, but has repeatedly called the dealmaking process 'tough' due to India's high import duties and a growing trade imbalance with the U.S. Greer said in an interview on CNBC Monday that brokering a deal with India will take more time. 'They have expressed strong interest in opening portions of their market, we of course are willing to continue talking to them,' the USTR ambassador said. 'But I think we need some more negotiations on that with our Indian friends to see how ambitious they want to be.' Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Axios
4 hours ago
- Business
- Axios
What to know about the "de minimis" exemption that Trump is now ending
President Trump revoked on Wednesday an exemption on tariffs for global packages worth less than $800. Why it matters: The "de minimis" loophole has been an important protection for businesses overseas and U.S. customers, and getting rid of it will make low-price goods from around the world more expensive for Americans. The suspension has been in place for China since April, and has had a serious impact on major Chinese retailers like Shein and Temu. What's next: After months of an on-and-off trade policy, Trump is moving ahead with his Friday deadline to raise, or put into effect, tariffs on both key goods and major allies. Here's what to know: When the suspension goes into effect State of play: The de minimis exemption will end on Aug. 29, the White House said. What the de minimis exemption is Packages valued under $800 have enjoyed an exemption from added duties, which has previously enabled foreign online retailers like Temu and Shein to sell super-cheap items to American consumers. By the numbers: The number of de minimis entries has grown to more than 1 billion in 2023 from 153 million in 2015, according to Congress. Context: Congress initially enacted the exemption in 1930 "to improve administrative efficiency and to avoid expense and inconvenience to the government," according to Congress' website. How the exemption will impact international products Zoom in: International shipments will taxed one of two ways: An "ad valorem" duty equal to the tariff rate set by the International Emergency Economic Powers Act (IEEPA), or A "specific duty" with a temporary tax between $80 and $200 per item. After six months, however, "all applicable shipments must comply with the ad valorem duty methodology, " according to the White House statement. American travelers can still "bring back up to $200 in personal items and individuals can continue to receive bona fide gifts valued at $100 or less duty-free," however. How the suspension will impact U.S. businesses, consumers De minimis critics say the loophole has hurt U.S. businesses, such as fashion retailer Forever 21, which began liquidating its U.S. stores after blaming the rise of Shein and Temu in part for its downfall. "The ability for non-U.S. retailers to sell their products at drastically lower prices to U.S. consumers has significantly impacted the Company's ability to retain its traditional core customer base," Forever 21 co-chief restructuring officer Stephen Coulombe said in a court filing. The other side: Free-market think tank Cato Institute has argued that eliminating the exemption means "effectively raising taxes on American consumers and dramatically increasing shipping times." How the suspension has affected Chinese products Americans' use of Temu and Shein have slowed significantly since Trump closed the loophole for China, according to data shared with CNBC by market intelligence firm Sensor Tower.
Engadget
5 hours ago
- Business
- Engadget
Trump will end the de minimis exemption for low-cost global shipments
President Donald Trump's latest economic move is to halt the de minimis exemption, a provision that made international shipments of low-value items cheaper. When the exemption ends on August 29, shipments valued at or under $800 will be subject to duty fees when sent by any carrier other than the international postal network, no matter what country they are coming from. According to the White House's announcement of this change, shipments will either be assessed with an ad valorem duty equal to the tariff rate for the country of origin set by the International Emergency Economic Powers Act or with a limited-time specific duty between $80 and $200 per item. The specific duty will only be a available for six months, after which all shipments will be subject to an ad valorem duty. The administration claimed the de minimis exemption was harming US businesses and that the loophole was being used to ship synthetic opioids such as fentanyl into the country. The administration had already suspended de minimis exemptions for shipments from China and Hong Kong in May. A large number of those low-cost purchases originated in those regions, which are the center for several online shopping sites specializing in inexpensive goods, such as Shein and Temu and Amazon's Haul .
Axios
8 hours ago
- Business
- Axios
Scoop: Senate Dems launching last-ditch bid to block Trump tariffs
Senate Democrats on Wednesday will mount a last-ditch effort to block President Trump's tariffs from taking full effect at the end of this week, Axios has learned. Why it matters: Democrats, who argue Trump's tariffs could add $2,400 to the average American household expenses, are making signs of economic angst a centerpiece of their 2026 midterm messaging. Sen. Jeanne Shaheen (D-N.H.) on Wednesday evening will ask lawmakers to unanimously pass a bill affirming that the tariffs can't be authorized under the International Emergency Economic Powers Act, Axios has learned. That's the law the administration is citing as giving it the authority to impose the levies. Friday is the date when tariffs rise for dozens of countries, as threatened by Trump in letters earlier this month. Many are lower than the rates he first imposed in April, though some are higher. Driving the news: It will take just one lawmaker to block Shaheen's move, and Republicans will almost certainly do so. But it gives Democrats the opportunity to get Republicans on the record in support of the tariff hikes. Shaheen's move comes one day before a federal appellate court hears arguments on whether to overturn a lower-court ruling that the IEEPA tariffs were illegal. Zoom out: The unanimous consent request is part of broader anti-tariff push that Democrats will hold on the Senate floor on Wednesday evening, according to people familiar with the matter. Shaheen will lead a half dozen Democratic senators in highlighting the impact the duties will have on working families. "And now, on Friday, the Administration is planning to make the goods businesses and families need 10, or 30 or even 40 percent more expensive overnight," Shaheen will say, according to remarks shared with Axios.
