A provision long used by e-commerce giants to bypass the U.S. tariffs on low-value goods will be fully repealed by mid-2027 under a sweeping bill signed by President Donald Trump. The move marks a decisive shift in U.S. trade enforcement, with ripple effects expected across global fulfillment models and cross-border retail logistics.
Full Repeal Targets E-Commerce Supply Chains
The United States will eliminate its de minimis exemption for most commercial imports starting July 1, 2027, closing a widely used duty-free loophole for shipments valued under $800. The change, signed into law as part of the “One Big Beautiful Bill Act,” will end a practice that enabled foreign retailers to avoid U.S. import taxes by shipping directly to consumers in small parcels.
The exemption will continue to apply only in limited contexts, specifically, for eligible goods purchased during international travel and for gifts sent by individuals abroad to U.S. recipients. In parallel, the bill introduces new civil penalties of $5,000 for a first violation and up to $10,000 for repeat offenses involving misuse of the de minimis channel, reinforcing Customs and Border Protection’s expanded enforcement authority.
The repeal follows earlier policy steps by the Trump administration, including a May 2025 ban on de minimis eligibility for goods from China and Hong Kong. Prior to that move, China accounted for more than three-quarters of all de minimis shipments entering the U.S., according to fiscal year 2024 data from CBP. The full sunset of the exemption will now broaden those restrictions to cover low-cost imports from Mexico, Canada, and other trade partners.
Low-Cost Retailers Rethink Fulfillment
Fast-fashion and discount platforms like Shein and Temu, which have leaned heavily on direct-to-consumer shipping models from overseas factories, are expected to be among the most affected. Without the de minimis shield, these companies face mounting pressure to absorb tariff costs, shift to bulk shipping and customs-cleared distribution, or invest in deeper U.S. fulfillment infrastructure to maintain delivery speed and cost competitiveness.
A growing number of retailers had already begun reassessing their U.S. logistics networks following China’s exclusion in May. Analysts suggest the full repeal could accelerate that trend, prompting the rise of regional consolidation hubs and bonded warehouse strategies to mitigate duty exposure. According to trade data tracked by the International Trade Commission, some companies are exploring nearshoring alternatives in Mexico and Southeast Asia, not only to reduce tariff liabilities but to better manage compliance risk tied to origin claims and valuation practices.
De Minimis Repeal Set to Reshape Global Fulfillment
The rollback of de minimis privileges isn’t just a policy shift, it’s a strategic inflection point for how low-cost goods flow into the U.S. As more e-commerce operators recalibrate for duty-bearing entry, logistics patterns are likely to consolidate around volume-based shipments and zone-skipping strategies. But a less-discussed impact is the potential for increased customs scrutiny and processing delays, especially for platforms that continue to rely on fragmented parcel flows. While the policy targets trade compliance, its effects will ripple deep into operational design.
