US-China deal to slash tariffs also eases burden on cheap packages
[May 14, 2025] By
DIDI TANG
WASHINGTON (AP) — Online shoppers in the U.S. will see a price break on
their purchases valued at less than $800 and shipped from China after
the Trump administration reached a truce with Beijing over sky-high
tariffs.
An executive order Monday from President Donald Trump said the tariffs
on low-value parcels originating from China and coming through the U.S.
Postal Service will be lowered to 54%, down from 120%.
It also says a per-package flat rate — as an alternative to the
value-based tariff — will be kept at $100, rather than being raised to
$200 on June 1 as previously decreed. Packages shipped by commercial
carriers are subject to the general tariff, which also has been cut.
The new rules go into effect Wednesday.
They are part of a broader agreement by the Trump administration to
drastically lower import taxes on all Chinese goods from 145% to 30%
following weekend talks in Switzerland with Chinese officials. China
issued a public notice on Tuesday lowering its own tariffs on U.S. goods
to 10%, down from 125%.
However, the reductions are temporary, allowing the two sides to
negotiate a longer-term deal in the next 90 days.
Izzy Rosenzweig, founder and CEO of the logistic company Portless, said
U.S. brands are “very excited” about the broader tariff cut. The import
tax is still high, but not as prohibitive as when it was 145%, which
amounted to a trade embargo.
On the low-value shipments, online purchases had been coming into the
U.S. duty-free for several years under the de minimis rule, which
exempted them from the import tax.
[to top of second column] |
U.S. Trade Representative Jamieson Greer, left, and U.S. Secretary
of the Treasury Scott Bessent take part in a press conference after
two days of closed-door discussions on trade between the United
States and China, in Geneva, Switzerland, Monday, May 12, 2025.
(Jean-Christophe Bott/Keystone via AP)
 Popular shopping sites such as Shein
and Temu that offer ultra-low prices took advantage of the duty-free
rule by shipping directly from China to U.S. buyers, bypassing more
cumbersome customs paperwork.
President Donald Trump terminated the exemption on such parcels
originating from China and Hong Kong on May 2, following criticism
that it not only resulted in lost tariff revenue but also allowed
illicit drugs and unsafe products to flow into the U.S. without
adequate scrutiny.
U.S. Customs and Border Protection said as many as 4 million
low-value parcels were coming into the U.S. every day — many of
which originated from China.
Shortly before the exemption ended on May 2, prices on many items
sold by Shein rose. Temu apparently halted shipments from China and
tapped its existing inventory in the U.S.
John Lash, group vice president of product strategy at the supply
chain platform e2open, said he expected the volume of low-value
packages would now rise but not back to previous levels. The $100
flat rate, he said, means that higher-value packages could get less
of a hit, because the effective duty rate could be as low as 13%.
Neither Shein nor Temu immediately responded to requests for comment
Tuesday about the lower tariffs.
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