CPA Celebrates Closing of De Minimis Loophole

WASHINGTON, D.C. — The Coalition for a Prosperous America (CPA) today celebrated the Trump administration for ending the de minimis trade loophole. This loophole allowed overseas vendors to ship directly to American consumers without any meaningful customs scrutiny if the foreign vendor merely alleged that the value was below $800 in their country. Previously, effective May 2, the administration had ended de minimis for imports from China and Hong Kong, where a significant amount of de minimis shipments originate.

This move – which went into effect at midnight – stops the descent into eCommerce lawlessness characterized by the rise in platforms like Temu and Shein, and the fact that judgment-proof overseas retailers now make up the majority of vendors on Amazon’s U.S. store. The move was the critical first step in correcting the unfair prejudice faced by U.S.-based retailers – both brick and mortar and online – who must respect everything from intellectual property rights to product safety standards or face repercussions in U.S. courts.

Closing de minimis means that commercial imports declared as below $800 must enter the United States through a customs procedure known as “Informal Entry”, which was already in place for shipments declared between $800 and $2,500. Informal Entry is a substantial improvement over de minimis lawlessness, because importers must submit standard import documentation and pay applicable duties and taxes. The waiving of customs fees and duties under de minimis represented an outrageous subsidy to judgment-proof overseas fly-by-night vendors. While Informal Entry is a substantial improvement over de minimis lawlessness, there are still accountability problems, such as the lack of a requirement for a U.S.-based Importer of Record, as well as no bonding requirements.

CPA has long supported the total repeal of de minimis as it is incompatible with the rule of law and has overwhelmed U.S. ports entirely. Under de minimis, nearly 1 billion packages per year – most from China – entered the U.S. duty free without scrutiny or meaningful regulation. For years, overseas vendors exploited this loophole to flood our market with untaxed, uninspected, and often dangerous goods—including counterfeit products and fentanyl precursors—undermining U.S. industries and endangering our communities.

“We thanked President Trump back in May for his executive action to close the de minimis loophole for China and Hong Kong, and again in July for closing it to all countries. We saw this as a monumental victory for American workers, manufacturers, and national security,” said Zach Mottl, Chairman of CPA. “By following up to close it across the globe, the President has taken critical action toward restoring law and order to our trade system.”

Some importers predicted that when China lost its duty free access to American consumers via e-commerce de minimis back in May that it would cause major problems with U.S. Customs and Border Protection (CBP) at ports of entry. They would have to reclassify those shipments and make sure the proper tariff rates were applied. But those bottlenecks never came to fruition. CPA expects that similar calls of chaos are likely to be made in the press now that de minimis officially ended for all countries. In fact, order will begin to return. Rather than containers full of 10,000 individually packaged, mailbox-sized shipments, importers will return to importing in bulk. Bulk imports are far more secure, and necessary for CBP to effectively enforce U.S. laws.

CBP officials said they will be able to handle the change, and have been preparing for it for months.

“To reiterate what CPA said this summer, this is a monumental victory for American workers, manufacturers, and national security. President Trump’s move to end abuse of the de minimis loophole in May was a critical step forward, and today’s deadline effectively finishes the job that the administration set out to do,” said Jon Toomey, President of CPA. “De minimis was a massive backdoor for untaxed, uninspected imports from all countries – and our members are proud to see the administration go further than just China to end de minimis treatment so that every foreign seller plays by the same rules as our American businesses do.”

CPA led advocacy warnings on the de minimis catastrophe for years. In 2022, Jeff Ferry, now Chief Economist Emeritus at CPA, wrote a report estimating that the U.S. goods deficit was at least $128 billion more due to duty free de minimis entry.