() Tariff exemptions for packages shipped to the U.S. worth $800 or less are set to end this week.

In July, President Donald Trump enacted an executive order to halt the “de minimis” tax exemption rule, which has prompted a growing number of postal carriers worldwide to stop package deliveries to the United States.

On Friday, Aug. 29, imported packages valued under $800 will no longer be duty-free and will be subject to country-specific tariffs.

Letters and personal gifts worth under $100, however, remain unaffected by the impending changes.

What is the de minimis exemption?

The de minimis tax exemption, established in 1938 under Section 321 of the Tariff Act of 1930, permits low-value packages to enter the country without incurring duty fees.

The rule has been amended several times over the years, and in 2016, the exemption was raised to include products valued at or under $800.

In 2024, more than 92% of all cargo entering the U.S., which included 1.3 billion packages valued at over $64 billion, utilized the de minimis exemption, according to the CBP.

Why is the U.S. suspending de minimis?

There is bipartisan consensus on either revising or eliminating de minimis shipments. Critics argue these shipments offer an unfair competitive edge to international manufacturers and facilitate the entry of drugs and undesirable goods due to expedited processing and reduced scrutiny.

Both the Biden and Trump administrations have expressed concern about the potentially negative impacts of de minimis shipments.

The Trump administration’s executive order from July stated, “The risks associated with evasion, deception, and illicit-drug importation are particularly elevated for low-value items eligible for duty-free de minimis treatment.”

Just before Trump assumed office in early 2025, the U.S. Customs and Border Patrol issued a Notice of Proposed Rulemaking. This notice seeks to tighten the criteria for de minimis exemptions, stating that international firms exploit the tariff loophole to the disadvantage of U.S. companies.

“The exemption of these goods from duties or taxes has undermined American businesses and workers and flooded our ports of entry with foreign-made products,” former Secretary of Homeland Security Alejandro N. Mayorkas said.

In April, Trump signed an executive order to end the de minimis exemption exclusively for China and Hong Kong to counter “the ongoing health emergency posed by the illicit flow of synthetic opioids into the U.S.” This increased the duty rates for goods that would have been covered by the de minimis protection to 30% of their value.

Now, every country is set to lose the benefits of the exemption.

How are countries reacting?

In response to the suspension of de minimis exemptions, postal services around the world are announcing plans to halt certain shipments to the U.S., according to previous reporting.

Europe’s largest shipping provider, DHL, announced that it cannot ship business parcels to the U.S. until details surrounding the new duties are clarified.

Germany, Denmark, Sweden and Italy are among the countries that have already stopped shipping many packages to the U.S.

France and Austria will halt certain deliveries on Monday, while the U.K. will do the same by Tuesday.

India’s postal officials have announced they will suspend most shipments to the U.S. starting Aug. 25.

It’s unclear how long the de minimis exemption will be suspended for. However, until details surrounding its enforcement are clarified, more and more countries will likely continue to cease certain shipments to the U.S.

What does it mean for businesses?

The suspension of de minimis exemptions will likely impact the global economy significantly.

Global e-commerce businesses, particularly fast fashion brands like Shein and Temu, will be greatly affected by the shift in policy.

These companies have already begun increasing prices on their products in response to Trump’s trade policies.

A 2023 report by the House Select Committee on China’s Communist Party found that Shein and Temu are responsible for more than 30% of all packages shipped to the U.S. daily under the de minimis exemption.

Companies that depend on foreign products for their operations, such as drop shippers who sell items through third-party manufacturers, are also likely to encounter profit concerns.

American consumers may suffer

With companies around the world likely to increase their prices to reflect the tumultuous trade policies, American consumers could face the brunt of the impact from the elimination of de minimis worldwide.

Research suggests that eliminating the exemption could result in costs of $11 billion to $13 billion for American consumers, disproportionately hurting low-income and minority households, as previously reported by .