Story perspectives

New Tariffs Slash Duty-Free Packages, Impact Global Small Businesses

8/31/2025

Summary

Businesses Adjust Tariffs

The removal of the de minimis exemption has reduced daily duty-free packages entering the U.S. from 4 million to 1 million since May.
Global small businesses, especially those with direct-to-consumer models, face rising shipping costs and some have ceased U.S. shipments.
U.S. Customs and Border Protection anticipates increased paperwork and compliance issues as international postal services adjust to new tariffs.
Many foreign postal services have paused U.S. shipments, resulting in delays and cancellations for consumers.
Some U.S. small businesses see tariff changes as beneficial, potentially leveling the playing field against larger retailers.

Summary

Consumers Face Tariff Increases

The de minimis exemption for low-value imports, allowing duty-free entry for packages under $800, ended on August 29, 2025.
Consumers may face increased costs of $10 to $13 billion annually, affecting low-income households.
Small businesses on platforms like Etsy and TikTok Shop anticipate higher shipping costs and price increases.
Over 30 countries have restricted shipments to the U.S., causing global shipping delays.
The policy aims to reduce illicit imports and is expected to generate an additional $10 billion in tariff revenue.

History

Historical Context

The removal of the de minimis exemption in 2025 mirrors the 1930 Smoot-Hawley Tariff Act, which raised tariffs and incited global trade tensions. This policy change, expected to generate an additional $10 billion in tariff revenue, affects over 30 countries and aims to combat illicit imports, but may impose higher costs on consumers, particularly low-income households, potentially increasing their expenses by $10 to $13 billion annually.

1 of 3

Businesses Adjust Tariffs

The removal of the de minimis exemption has reduced daily duty-free packages entering the U.S. from 4 million to 1 million since May.
Global small businesses, especially those with direct-to-consumer models, face rising shipping costs and some have ceased U.S. shipments.
U.S. Customs and Border Protection anticipates increased paperwork and compliance issues as international postal services adjust to new tariffs.
Many foreign postal services have paused U.S. shipments, resulting in delays and cancellations for consumers.
Some U.S. small businesses see tariff changes as beneficial, potentially leveling the playing field against larger retailers.

1 / 3