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China's e-commerce loads would renounce U.S. tariff immunity under the suggested law

June 15, 2023: On Wednesday, one of the sponsors stated that a bipartisan group of U.S. lawmakers planned to introduce a bill to eliminate a tariff exemption widely used by e-commerce sellers to dispatch orders from China to U.S. shoppers.

The de minimis rule exception exempts imports worth $800 or less from tariffs if the items are shipped to individual consumers. The bill would ban such shipments from China immediately upon enactment, sponsor Republican Senator Bill Cassidy said.

E-commerce sellers like China-founded, Singapore-based Shein, and Temu, a competitor owned by PDD Holdings that operates the Chinese e-commerce site Pinduoduo, are big inheritors of the exemption. A federal brief in April said the companies “exploit” de minimis to avoid tasks and import illegal items like those made in China’s Xinjiang region that caused Uyghur labor.

De minimis shipments had drawn attention since 2019 when the U.S. Consumer Product Safety Commission reported it struggled to catch unsafe imports due to the heavy book of low-value packages. U.S. customs data established that shipments increased to 685.5 million in 2022 compared with 410.5 million in 2018.

The bill’s sponsors are Republican Senator J.D. Vance and Democratic Senator Tammy Baldwin. It needed to be clarified how much traction the proposal would gain. A distinguishable but similar bill by Democratic Representative Earl Blumenauer failed to pass Congress the previous year.

Under the bill, countries other than China and Russia could keep the exemption by considering the $800 threshold for their tariff-free importance. The bill would permit private shippers such as FedEx, UPS, and DHL to transport de minimis packages and exclude postal services.

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