In a bid to what Donald Trump calls, “a wise move to save the economy,” on July 30, 2025, he signed an executive order suspending the long-standing De Minimis treatment for imports into the United States. What it does is remove the duty exemption on goods valued under $800, a move that could negatively impact shippers across the world.
This has caused a lot of ruckus among shippers as well as politicians.
Lauding this move, Representative Jason Smith, Chairman of the House Ways and Means Committee, said, “President Trump’s executive order provides immediate relief to American workers and small businesses. … this latest update will close off any opportunity for bad actors to circumvent our trade enforcement laws by routing de minimis shipments through other countries.” He added, “Coupled together, these actions show how Congress and the Trump Administration can use our authorities to restore fairness in our trade system, deliver economic security, and put American workers and businesses first.”
Regardless of what politicians are saying, the move is confusing and not well received by the public. Now that the time has come to put it into practice, it is important for businesses to understand its nuances and prepare accordingly.
What’s Changing?
The recent executive order effectively suspends the long-standing de minimis exemption, which allowed shipments valued at $800 or less to be duty- and paperwork-free. According to the order, starting from August 29, all inbound packages, regardless of value, must go through standard customs processing and bear the burden of applicable duties and fees.
This changes the standard paradigm for courier companies and postal services, both of which will now have to collect duties at the point of entry or sender, since there are no simplified procedures any more.
To aid these postal service companies, Customs and Border Protection has provided updated guidance, which includes enlisting third-party tools to help with collection management and forwarding duties on affected parcels.
This could result in massive blowback to companies like Etsy and Shopify, whose buyers will now have to bear the additional cost burdens. This situation could snowball into more competition as companies try to maintain their edge at the cost of their profits.
Reacting to the news, a user on Reddit said,
“A mate of mine who sells his art online … is expecting to lose his US market, which is about 40% of his annual sales.”
Reason Behind the Policy
Three main factors, economic, enforcement, and geopolitical concerns, are behind the new policy. There have been concerns about this rule for years, especially within the trade industry. Policymakers believe it has been abused by foreign sellers, particularly from China, who have structured their shipments to ensure that they do not have to pay any duties.
As a result, policymakers argue that the United States has been deprived of customs revenue due to the uneven playing field thus created. It also means domestic manufacturers have been forced to operate under stricter import rules.
According to trade officials, security loopholes have also been a major issue. Millions of small parcels enter the country under the de minimis rule, making it difficult for Customs and Border Protection to screen them properly.
Reports suggest that this system has allowed the transfer of illegal goods, counterfeit products, and dangerous items into the country. Many have linked this to the influx of drugs as well. With the exemption now gone, everything falls under renewed and tighter compliance checks.
In summary, a mix of political signaling, economic protectionism, and national security concerns has been at the core of this policy.
Who is Impacted?
Now the major question arises: who will face the most adverse effects of this move? There are many actors who will suffer.
International Consumers
The internet has allowed buyers to access niche items: goods that are not available in their own country and must be sourced from abroad. As import duties rise, these consumers will end up paying significantly more than the items’ original value.
Users on Reddit have already started to express frustration, with one commenting, “Pain, my only official merch will be these glowsticks now.” Another figure and collectibles enthusiast lamented that this move is a major pain for the wallet.
Small Businesses and International Sellers
Those who sell their goods via Etsy or eBay and depend on international buyers will now face a major cost hurdle due to the logistical barriers created by the suspension. Sellers will have to charge more, which could make buyers apprehensive about their products.
Etsy has already taken its first steps. Posting on Reddit, one user said,
“So T-rump has come looking for tariffs on small items. The de minimis exemption, which kept our small Etsy sales out of the firing line, is now IN the firing line. The result? Etsy will stop all sales with USA destinations effective tomorrow!
Postal Operators and Couriers
Global postal operators and couriers have already started to scramble, with many suspending shipments to the United States. The Universal Postal Union, based in Switzerland, recently posted an update stating that postal operators in 25 member countries have suspended their outbound postal services to the United States.
Cross-Border B2C Sellers
There are also sellers who rely solely on a United States–based audience. These include artists and individuals who sell niche products in small batches. While the previous rules helped them sustain their businesses, the removal of the exemption means they will need to increase prices to cover costs and maintain profit margins.
One user on Reddit said in the r/Warhammer40k thread, “After de minimis is removed… the US Government will say ‘That is an import and is subject to tariffs… $80, whichever is higher.’ Orders from small companies… are where this will sting.”
Supply Chain and Providers
As already mentioned, the order has led global supply chain and logistics providers to scramble to make sense of the changes. Many have had to halt their services temporarily to readjust strategies in order to remain in compliance with the new environment.
What is the Level of Impact?
The suspension of the de minimis exemption has already started to negatively impact multiple layers of trade and commerce.
For consumers in the United States, the immediate effect comes from rising costs and reduced access to affordable products, especially niche ones such as fashion, collectibles, and electronics.
For small businesses relying on the United States market, the impact has been severe enough to lead some of them to suspend operations entirely.
Global postal networks have also begun to suffer. More than two dozen countries have suspended parcel shipments to the United States while they alter duty-collection systems. Logistics providers are now scrambling to redesign their workflows, which will slow down the supply chain.
The only positive so far has been for the United States government, which is seeing gains through additional revenue and trade enforcement. What the overarching impact of this move will be, only time will tell.
What Should Businesses Do Now?
In order to quell the tide of this latest trade move, businesses should make practical adjustments to get ready.
- Be transparent about costs and display potential duties and taxes at checkout.
- Partner with 3PLs and set up distribution hubs to avoid repetitive import duties when orders are small.
- Encourage customers to place higher-value orders, where tariffs represent only a small percentage of the overall cost.
- Work with carriers and customs brokers that provide updated compliance solutions and a clear duty-collection process.
- Be open with the customer base and explain the reasons for the new policies in order to preserve trust.
How ShippingChimp can help?
ShippingChimp can help Canadian businesses navigate these cross-border chaos in the following way:
- Reduced brokerage fees
- Expedite US deliveries
- Offer transparent duties and takes
- Flexible US ware housing options
If you would like to learn for More about de-minimis suspension and how ShippingChimp can help, learn more at de-minimis Canada US eCommerce Shipping 2025
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