The de minimis exemption, which allows imports valued at $800 or less per person per day to enter the United States free of tariffs, officially ended for goods originating from China and Hong Kong on Friday, May 2.

Such imports are now subject to applicable duties and taxes, a fact that stands to increase importing costs for promotional products companies that had previously leveraged what critics have called a loophole to bring $800-and-below shipments of products stateside tariff free.

Still, others in promo support President Donald Trump’s move to end the exemption; they say doing so levels the playing field.

The de minimis exemption remains in place for imports originating from nations that are not China or Hong Kong, but Trump’s administration has also expressed interest in eventually ending those exclusions as well.

Basics of the New Importing Rules

Shipments of Chinese/Hong Kong-origin goods formerly covered by the de minimis exemption will now face duty rates, which can vary based on the carrier.

Such shipments sent through the international postal network (Universal Postal Union) and transported by carriers will be subject to either: a tariff of 120% of the value of the postal item containing goods or $100 per postal item containing goods – a charge that rises to $200 for goods entered for consumption come June 1.

4 Million
The average number of de minimis import shipments processed each day by U.S. Customs and Border Protection.(The White House)

U.S. Customs and Border Protection says that for items sent through the international postal network, levies will be in lieu of any other duties to which the shipments would otherwise be subjected. That includes this year’s 20% tariffs imposed in response to concerns about fentanyl and illegal immigration, as well as Section 301 tariffs.

However, the tariffs will also apply to “subject shipments even if they are shipped from China or Hong Kong to another country and then transported to the U.S.,” note legal experts at the law firm Sandler, Travis & Rosenberg.

Meanwhile, if shipments that formerly qualified for de minimis are coming through carriers not part of the Universal Postal Union (think UPS, FedEx, DHL), then the shipments are subject to all applicable duties. That means, for instance, Section 301 tariffs Trump imposed on China during his first term, as well as the 145% rate in additional levies the U.S. president has placed on China-origin goods so far in 2025, will apply.

$1.36 Billion
Value of imported shipments claiming the de minimis exception in fiscal year 2024.(U.S. Customs and Border Protection)

A Range of Promo Reactions

Some importers that bring products in bulk to the United States have said they’re pleased to see the de minimis exemption revoked for China- and Hong Kong-origin products, as they believe it provided an unfair advantage to those leveraging it.

“I’m very much in favor of its removal,” says Jeff Schrimmer, owner of the supplier Brighter Promotions (asi/42016). “It rankles my mind that I, as an importer importing 10,000 or 20,000 pieces of an item, am supposed to pay tariffs but then somebody’s able to buy $800 worth and avoid all the tariffs and duties. The exemption hurts those businesses that are actually investing in the U.S. with distribution centers with finishing products and an employee base here.”

Tom Goos, president and CEO of Counselor Best Place to Work distributor Image Source (asi/230121), understands and acknowledges why higher-volume importers in promo and other markets would be pleased to see the de minimis exemption go. Still, he says the removal on China-made projects affects his firm and others in the industry that have relied upon it. “It does impact our business as we have a few significant programs where we bring in hundreds of small orders a month under the de minimis exemption,” Goos tells ASI Media.

“The de minimis exemption hurts those businesses that are actually investing in the U.S. with distribution centers with finishing products and an employee base here.”Jeff Schrimmer, Brighter Promotions (asi/42016)

Chris Babiash, president/CEO of distributor Booshie Inc., says the de minimis exemption going away will have a definite effect on the business. “A majority of (our) orders coming out of China are team- or project-based and 90% of them are under $800,” Babiash tells ASI Media. “It will force me to look at alternatives outside of China … but we will never be able to pull all of our eggs of that basket.”

Josh King, CEO of Counselor Best Place to Work distributor You Name It Specialties (YNIS, asi/365123), says “the elimination of this exception will be extremely impactful for promo,” making it cost-prohibitive for smaller orders of products like lapel pins, table covers, sublimated apparel, feather flags and event tents.

King says he’s already seen a 20% to 40% increase in the cost of certain items because of the exemption being removed. He’s found some domestic sources that are “similarly priced so we have some options to offer clients.”

“The elimination of this exception will be extremely impactful for promo.” Josh King, You Name It Specialties (asi/365123)

Still, King adds: “The ripple effect of this exception being removed has not yet fully materialized. It isn’t until YNIS’ clients and consumers attempt to order something that was previously shipped internationally, and the pricing is much higher, that they will understand the ramifications of this decision. Many of the items we all purchase from international sources are not readily available domestically, and supply chain disruptions, as well as a significant increase in inflation, is coming.”

Others in promo didn’t have strong feelings one way or the other. A couple distributors ASI Media spoke with said they’d never even heard of the de minimis exemption. Some suppliers said it’s not an importing strategy they’ve used and so weren’t concerned one way or the other.

The elimination of the de minimis exemption “has minimal impact on our business,” says Tim Holliday, co-owner of Florida-based distributor Children’s World Uniform Supply/Business World Promo Supply (asi/161711), a Counselor Best Place to Work. “Most of the orders we are importing do not qualify for this exemption.”

The President’s Position

The White House has said eliminating the de minimis exemption for China and Hong Kong is “a critical step in countering the ongoing health emergency posed by the illicit flow of synthetic opioids into the U.S.” from China. The packages formerly eligible for the de minimis exemption are also no longer subject to expedited customs clearance and must undergo a more rigorous evaluation by border officials.

President Trump has said eliminating the de minimis exemption will benefit America.

“It’s a big deal,” he said at a cabinet meeting. Trump called the exemption “a big scam … And we put an end to it.”

Some U.S.-based proponents have also said that eliminating the de minimis exemption will prevent China-based e-commerce retailers like Shein and Temu from having an unfair advantage over domestic providers/retailers. Proponents assert that it could lead to Americans turning more to domestic sources.

In fact, Temu has said it will stop selling China-made goods directly to U.S. customers on its platform. Instead, “locally based sellers” will fulfill orders, the company said.

“All sales in the U.S. are now handled by locally based sellers, with orders fulfilled from within the country,” Temu said. “The move is designed to help local merchants reach more customers and grow their businesses.