Trade Court Upholds Trump’s End to $800 De Minimis Import Exemption
Temu and Shein shoppers could be the hardest hit.
Buyer beware: Your next bargain from Chinese online-shopping giants Temu and Shein might cost more thanks to a legal decision announced Thursday.
A federal trade court upheld President Trump’s suspension of the $800 de minimis exemption that had allowed a flood of low-value packages to enter the United States duty-free.
The unanimous three-judge panel of the U.S. Court of International Trade rejected a challenge by Detroit Axle, an auto-parts distributor that argued Mr. Trump lacked authority under the International Emergency Economic Powers Act to rescind the exemption.
The ruling leaves Mr. Trump’s suspension in place until July 1, 2027, when Congress’ repeal of the exemption under the One Big Beautiful Bill Act takes effect.
The court distinguished the case from the Supreme Court’s February ruling that IEEPA does not authorize presidents to impose tariffs. Ending de minimis, the trade court said, does not create new tariffs but makes low-value goods subject to duties Congress already established.
“We hold that IEEPA authorizes the President’s rescission of the de minimis exemption,” the panel declared.
The judges said federal law repeatedly describes de minimis treatment as a “privilege,” and IEEPA expressly empowers presidents during qualifying national emergencies to nullify or void the exercise of certain privileges involving foreign property.
Mr. Trump celebrated the decision Thursday on Truth Social, calling it a “BIG WIN” against “one of the most DESPICABLE loopholes in American Trade Policy.” He said the exemption had benefited tariff evaders, counterfeiters, and fentanyl traffickers.
The president said the exemption cost the United States an estimated $10.8 billion in forgone tariff revenue in 2024. “Today, THEY LOST,” he wrote of importers challenging his action.
The exemption’s use had grown dramatically as cross-border e-commerce expanded. U.S. Customs and Border Protection data show de minimis shipments increased from about 139 million in fiscal 2015 to more than 1.36 billion in fiscal 2024, nearly a tenfold increase.
Congress raised the general de minimis threshold from $200 to $800 in 2016. By fiscal 2023, more than 1 billion packages were entering under the provision. CBP was later processing roughly 4 million low-value shipments daily.
China became the dominant source, with Reuters reporting last year that about 73 percent of de minimis packages entering the United States in 2024 originated there. A 2023 House Select Committee report estimated online-shopping giants Shein and Temu together accounted for more than 30 percent of daily U.S. de minimis packages.
The exemption helped power the companies’ direct-from-China model, allowing inexpensive clothing and other merchandise to reach American consumers without duties on qualifying packages.
That changed first for China and Hong Kong in May 2025, then globally in August 2025. Reuters reported the shift increased retailers’ costs and was expected to raise prices for U.S. shoppers.
Temu altered its U.S. model, adjusted product availability, and raised prices after the China exemption ended. It later resumed some direct shipments from Chinese factories. Shein also raised prices.
Both companies have expanded their use of U.S. warehouses, reducing reliance on individual duty-free parcels sent directly from China.
The House committee’s 2023 investigation also criticized the companies’ use of de minimis because qualifying shipments received less customs scrutiny. It said Temu lacked a system to ensure compliance with the Uyghur Forced Labor Prevention Act.
Detroit Axle argued Congress’ decision to schedule repeal for 2027 gave businesses time to adjust and showed Mr. Trump could not eliminate the exemption earlier.
The trade court disagreed. It said Congress expressly preserved presidential authority to restrict de minimis treatment before the statutory repeal date.
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