Temporary Fix to De Minimis Won't Suffice Without Congressional Reform, Says ITIF
WASHINGTON—Ahead of the expiration of the de minimis loophole for imports from China and Hong Kong tomorrow, May 2, the Information Technology and Innovation Foundation (ITIF), the leading think tank for science and technology policy, released the following statement from Policy Analyst Eli Clemens:
The partial closure of the de minimis loophole is a necessary, but costly, fix to Chinese e-commerce platforms’ unfair advantages over U.S. retailers. Platforms like Temu and SHEIN deliberately structured their international expansion strategies around de minimis to bypass duties. While this reform is a step towards safeguarding U.S. competitiveness, it does away with the benefits of fast, low-cost cross-border commerce.
Starting May 2, the United States will impose significant new duties on low-value postal shipments from China and Hong Kong, ending their de minimis eligibility. These shipments will now face a 120 percent ad valorem tariff or flat fees starting at $100 per package, rising to $200 in June. This marks the most forceful federal action yet to curb the use of de minimis by Chinese e-commerce platforms that avoid duties while capturing U.S. market share.
While this enforcement shift may curtail some abuse of a regulatory loophole, it is only one step in addressing Chinese e-commerce platforms’ many unfair advantages. Chinese platforms will continue to benefit from unfair government-backed e-commerce industrial policy as they pivot quickly to domestic warehousing and alternative logistics business models.
Ultimately, Congress should modernize the de minimis statute to align trade enforcement with today’s global e-commerce realities. For example, Customs and Border Protection and the U.S. Postal Service both need technological upgrades, including AI-enabled monitoring systems, to manage enforcement at scale. To move forward, Congress should preserve the benefits of de minimis for vetted vendors while deterring abuse and restoring fairness for U.S. manufacturers and retailers. Executive action alone cannot provide the predictability or legal durability that is needed.
Contact: Nicole Hinojosa, [email protected]
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The Information Technology and Innovation Foundation (ITIF) is an independent, nonprofit, nonpartisan research and educational institute focusing on the intersection of technological innovation and public policy. Recognized by its peers in the think tank community as the global center of excellence for science and technology policy, ITIF’s mission is to formulate and promote policy solutions that accelerate innovation and boost productivity to spur growth, opportunity, and progress.
