The news: The Trump administration is ratcheting up tariffs on de minimis imports from China and Hong Kong as part of its rapidly escalating trade war.

As it stands: As of this writing, packages from China valued at less than $800 will be subject to duties of 120% beginning on May 2—quadruple the level that was initially announced.

Alternatively, they could face fees of $100 per package until June 1, at which point the per package fee will be doubled to $200.

Considerable consequences: Shein and Temu are typically seen as the poster children of de minimis use (or abuse, from the perspective of retailers like Forever 21), but plenty of US-based companies—including Amazon—rely on the exemption in some form to pad their margins while keeping prices low. The new duties will add considerable cost and complexity to those businesses’ operations, threatening their ability to compete in an increasingly difficult retail environment.

• Nearly 4 million packages entered the US per day under the de minimis exemption in 2024, with the majority originating from China, per US Customs and Border Protection data.
• While the tariffs will likely staunch that flow, they also raise the burden on customs officials who must now process and collect duties—which could lead to pile-ups and delayed shipments, particularly during the initial adjustment period.
• And any costs stemming from the tariffs—including the duties themselves, as well as any additional fees from brokers or logistics providers—will most likely be borne mainly by the consumer in the form of higher prices.

What this means for Chinese ecommerce companies: The much higher rate of tariffs is a big problem for Shein and Temu, as it all but eliminates their price advantage. Their options are also limited by the simmering geopolitical tensions between the US and China, which is keeping Shein from pursuing plans to diversify manufacturing to Southeast Asia and could hinder both companies’ efforts to expand their US supply chain.

Their loss will be Amazon’s gain. While the retailer does rely on de minimis for its ultra-cheap Haul offering, it recently began adding some of its owned inventory—including branded goods from the likes of adidas and Gap—to the marketplace, per The Information. That could mark the beginning of a shift to diversify Haul’s sourcing and position it as a bargain storefront, rather than a Temu copycat.

Our take: As with the rest of the Trump administration’s tariff policies thus far, the abrupt changes to de minimis are causing significant upheaval and financial pain for businesses. At the same time, there is little incentive for companies to adjust their sourcing plans at this point, given uncertainty around the current 90-day pause on reciprocal tariffs for all nations other than China.

Go further: Read our report on the Impact of Tariffs on US Businesses.