New rules in the US would deny duty-free exemptions to low-value packages containing goods subject to tariffs on hundreds of billions of dollars of Chinese imports, including many items of clothing.
The Biden administration on Friday released a last-minute proposed rule to curb duty-free imports under $800, known as “minimis,” rejecting the exemption for goods that are subject to other punitive U.S. tariffs.
The move is a setback for e-commerce companies, such as Shein and China's PDD Holdings, which have taken advantage of the “minimis” threshold to send millions of small packages a day to American customers.
President Joe Biden's administration first announced in September that it was taking steps to close a trade “loophole” it blames for shipments of fentanyl precursor chemicals evading customs inspection and tariffs.
The U.S. Customs and Border Protection agency said the proposed rules would deny duty-free exemptions to low-value packages containing goods subject to tariffs on hundreds of billions of dollars of Chinese imports, including many items of clothes.
They would also eliminate similar exemptions for goods subject to tariffs on steel and aluminum and solar products.
In addition, shippers of small packages will be required to include the 10-digit Harmonized Tariff Schedule classifications of the contents of the package in order to apply for exemption. The measure will allow customs officials to better identify and intercept illicit goods.
“We cannot allow e-commerce platforms founded in China to gain an unfair trade advantage while American companies play by the rules,” Lael Brainard, national economic adviser, said in a statement.
“Today's actions are an important step forward in leveling the playing field for American workers, retailers and manufacturers and in enforcing American laws that protect the health and safety of our consumers.”