A New Leash on Tariffs: US Policies Give Chinese Retailers Like Temu and Shein a Run for Their Money
Enhanced U.S. customs regulations pose challenges for e-commerce retailers like Temu and Shein.
When it comes to the trade war, the heat seems to be cooling down, with tariffs between China and the US taking a nosedive once more. But hang on, here's a twist in the tale! There's a specific regulation lurking around that's giving Chinese retail giants like Temu and Shein a whole new set of challenges.
Previously enjoying a freer ride due to the fact that shipments below $800 were tariff-free, these retailers are now faced with a tariff of 120% since the beginning of May, and a minimum fee of $100 per package. Merely a brief respite from President Donald Trump, who recently reduced the tariff rate to 54%, the $100 minimum fee persists. As per the plan, this figure will escalate to $200 from June 1, according to a mandate issued by the US President himself.
With consumers in the US accustomed to scooping up affordable goods from the likes of Temu, Shein, and their peers, these new regulations are set to drastically change their shopping experience. This new regulation could make it more cost-effective for the online retailers to ship the items to US warehouses and sell them directly. After all, the standard tariff for goods from China has been temporarily slashed to 30% as part of the agreement with Beijing.
Ever since the revocation of the "de minimis" regulation exemption for duty-free shipments worth $800 (and below), US retailers have been vocal about the competitive advantage this offered their Chinese counterparts. Trump's justification behind this move comes down to streamlining the entry of the harmful drug fentanyl into the country. Facing the heat of these new regulations, Chinese online retailers have had no choice but to hike their prices in the US.
Sources: ntv.de, jog/dpa
- Trade Disputes
- Tariffs
- United States
- Donald Trump
- Online Retailing
The new regulation abolishing the "de minimis" exemption for duty-free shipments worth $800 has sparked controversy, as it places a 120% tariff and a minimum fee of $100 per package on Chinese retail giants like Temu and Shein, a significant increase from the previous tariff-free status for shipments below $800. This new policy is set to escalate the minimum fee to $200 from June 1, as mandated by President Donald Trump.
These changes could result in a shift in strategy for Chinese online retailers, potentially making it more cost-effective to ship items to US warehouses and sell them directly, especially considering the temporary tariff reduction to 30% for goods from China as part of the agreement with Beijing. This development could significantly alter the shopping experience for consumers accustomed to affordable goods from these retailers.