For almost 100 years, there was a rule that many electronic commerce companies took advantage of, that of the so -called minimis: products with a value of less than $ 800 that can enter the United States free of taxes.
In Europe there is similar legislation, where it is exempt from customs rights to packages with less than 150 euros.
Both rules have been used by two Chinese companies with exponential growths in recent years: Shein and Temu. But that is about to end.
Trump advises the blow
On Saturday, February 1, in addition to the threats of tariffs for Mexico and Canada and the imposition of an extra 10% quota for Chinese imports, President Donald Trump gave a hard blow when suspending the exemption of the Minimis.
The argument is that this exemption had helped Shein and to keep very low prices in thousands of types of merchandise, from clothes to household items. The minimis rule would have helped both evade millions of dollars in taxes, according to their critics.
In 2024, a report by the House of Representatives on the Chinese Communist Party said that almost a third of all minimis that arrive in the United States are packages that were bought from those two websites.
The original threshold for the exemption was $ 200, and was designed as a benefit for American tourists to return, could send their souvenirs without excessive tax burden.
But in 2016 the threshold rose to 800 dollars and it was when companies such as Temu emerged, which under a single brand could combine the millions of products that were manufactured in a network of different stores and sellers in China.
The recent Trump adjustment seems like a solution. And now Temu is calling Internet users to consume “local products.” Now the items are sent from stores within the United States and has incorporated more vendors with American inventory in recent years.
Europe also puts them in the sights
Recently, the European Commission also announced new measures to mitigate the effects derived from the mass import of low-value products, through retailers and “extra-community” e-commerce. The dart is also addressed to Shein and Temu, and similar companies.
According to the European Union, in 2024 more than 12 million daily low value packages entered their territories, a figure that doubles that of 2023 and triples to that of 2022.
In 2024, 91% of all electronic commerce shipments worth up to 150 euros that entered the EU came from China and its volume doubled between 2023 and 2024: from 1,900 million to 4,170 million articles. This increase coincides with the extremely rapid growth of certain ecommerce. Temu and SheinIn particular, they have grown exponentially in the EU market, climbing more than 75 million users in the EU in a few months in 2024, explains the document ‘A Comprehensive Eu Toolbox for Safe and Sustainable e-commerce’.
But for Europeans, risks are not only commercial, but also security, unfair competition and even environmental impact. Therefore, they proposed key reforms, including eliminating the exemption of customs rights for packages with less than 150 euros. But also create a digital passport for products that allow to track the origin and compliance with European standards.
Investors are cautious
PDD Holdings is the company that owns Temu and quotes in the stock market of the United States. The recent news has made their shares fall 3.44% in their weekly comparison. And investors are cautious for these new changes.
However, the recent elimination of tax exemption for minimis in the United States is still in debate. Mainly, because it could imply a burden for customs officials and because it would lead to higher administrative costs from the government.
