CPA, Independent Retailers Call on Congress to Address De Minimis Loophole Exploited by China

WASHINGTON — The Coalition for a Prosperous America (CPA) today, along with nearly a dozen independent retail associations, called on Congress to address an import loophole, known as de minimis, that is used by non-market economies and counterfeiters to ship hundreds of millions of packages valued under $800 into the United States without inspection, information disclosure, or duty payment. The joint coalition letter urges Congress to include Representative Earl Blumenauer’s (D-OR) Import Security and Fairness Act, which would address the de minimis loophole, in any final China competition bill. This legislation was included in the America COMPETES Act of 2022 (H.R. 4521), the House-passed China competition bill.

The following organizations joined CPA in signing the letter: American Booksellers Association, American Independent Business Alliance, American Specialty Toy Retailing Association, Independent Office Products and  Furniture Dealers Association, Independent We Stand, Institute for Local Self Reliance, Main Street Alliance, North American Hardware and Paint Association, Running Industry Association, and Small Business Majority.

An analysis conducted by CPA Chief Economist Jeff Ferry found that the impact of de minimis on the U.S. economy is large and getting larger. CPA estimates the value of de minimis imports into the U.S. at $128 billion last year, suggesting our actual trade deficit in 2021 was 15% higher than official figures show, and U.S GDP was slightly lower. Rising de minimis imports cost the U.S. hundreds of thousands of good-paying jobs and hurt the U.S. manufacturing and bricks-and-mortar retail sectors.

“De minimis shippers hold a substantial advantage over sellers who sell products imported in bulk with duties paid; tariff savings have been quoted from 20% to 40%,” the letter states. “This onslaught poses an existential threat to independent retail stores’ survival, and to the economic and social health of the communities these locally owned small businesses serve.”

Read the full letter here.

Get the latest in CPA news, industry analysis, opinion, and updates from Team CPA.