President Trump’s new executive order closes a longstanding trade loophole that allowed China to flood the U.S. with duty-free goods—and fentanyl—with a move that’s being hailed as a win for American industry and national security.
AT A GLANCE
- Trump’s order ends the “de minimis” import exemption for low-value shipments from China
- Nearly 1.4 billion packages entered the U.S. under the loophole in 2024
- Online retailers like Temu and Shein now face up to 30% tariffs or flat fees
- The policy aims to curb fentanyl smuggling through deceptive shipping practices
- New rules take effect May 2, 2025
Trump Closes Exploited Loophole
President Donald Trump has signed an executive order that terminates the controversial “de minimis” exemption, which allowed foreign packages under $800 to enter the U.S. without tariffs. While originally designed for travelers bringing back souvenirs, the rule became a backdoor for Chinese e-commerce giants to ship duty-free merchandise directly to American consumers.
In 2024, nearly 1.4 billion such packages entered the U.S.—more than double the volume in 2020. According to data cited by the New York Post, Chinese sellers like Temu and Shein were among the biggest beneficiaries of this exemption, helping them undercut domestic producers.
Trump’s order not only revokes the de minimis privilege for shipments from China but also introduces specific tariffs: a 30% duty or a flat $25 per item, increasing to $50 by June 1. Additionally, it compels carriers to report detailed information on packages, bolstering Customs and Border Protection’s enforcement powers.
National Security and Economic Defense
While the executive order has drawn criticism from free-market advocates like the Cato Institute, who warn of higher prices for consumers, the administration has framed the move as a matter of national security. Trump cited the fentanyl crisis as a key motivator, stating that “[a] large percentage of these drugs, much of them in the form of Fentanyl, are made in, and supplied by, China.”
The executive order accuses Chinese exporters of using deceptive shipping practices to smuggle fentanyl and other illicit substances into the U.S. “They hide illicit substances and conceal the true contents of shipments,” the document claims. This loophole, previously immune to customs scrutiny, became a vector for criminal trafficking, according to the administration.
Watch coverage of Trump’s tariff crackdown.
Bipartisan Support Emerges
While Trump’s trade policies have often sparked partisan debate, this move drew rare bipartisan praise. Democratic Representative Rosa DeLauro of Connecticut told the New York Times, “For too long, this customs loophole has let foreign exporters flood our market with cheap goods and helped drug traffickers move fentanyl past our borders—resulting in factory closures, job losses and deaths.”
Commerce Secretary Wendy Yang confirmed that systems are now in place to enforce the order, collect tariffs, and screen shipments more effectively. The administration emphasized that this is not protectionism, but rather a necessary corrective to years of lopsided trade practices.
A Long-Overdue Correction
Critics of previous administrations argue that this trade gap should have been addressed years ago. Chinese retailers have built billion-dollar business models around circumventing U.S. tariffs, and Trump’s action marks the most aggressive attempt yet to clamp down on these practices.
While the full economic impact remains to be seen, the policy shift sends a clear message: the era of unchecked imports under the de minimis rule is over. Whether it results in higher consumer prices or revitalized American manufacturing, it represents a decisive pivot in trade policy—one aimed squarely at curbing both economic and pharmaceutical threats from abroad.
