WASHINGTON (BRAIN) — President Trump signed an executive order that will eliminate the $800 import threshold for goods from all countries beginning Aug. 29, including e-bikes, lithium-ion batteries, and related bike parts and accessories that are often hazardous.
The de minimis loophole has allowed single packages with an import value under $800 to arrive duty free, and often subject to less inspection for compliance with safety regulations. State or local sales taxes also are not collected on these shipments.
Retail groups have complained the loophole gives offshore sellers a major advantage and point to safety concerns about importation of uninspected lithium-ion batteries and other products. Illegal drugs, including fentanyl and products that violate U.S. intellectual property laws, also are thought to arrive under the de minimis exception.
Congress would still need to pass de minimis reform into law and close remaining loopholes, including the minimal entry documentation required for lower-valued shipments. Signed into law earlier this year, the Budget Reconciliation Bill includes a similar provision that eliminates de minimis benefits starting in 2027 and also applies to all countries.
In March, Rep. Linda Sánchez introduced legislation to close the loophole. Her legislation also would close the loophole on shipments from all countries. Pat Cunnane, an industry consultant and advisor to Hyper Bicycles, was quoted in Sánchez's press release announcing the legislation. He is the former CEO of ASE, the parent of the Performance Bicycle retail chain and the ASI distribution business. In February, Cunnane wrote a guest editorial for BRAIN calling for de minimis reform.
"It is great news for retailers and U.S. based businesses," Cunnane told BRAIN about the executive order. "It took a long time and was worth it. (De minimis) hurt many bicycle retailers for many years."
PeopleForBike General and Policy Counsel Matt Moore agreed.
"Eliminating de minimis shipments from all countries is a critical step to protecting riders, ensuring product safety, and creating a stronger, more competitive business environment," Moore said. "We will continue working with Congress and the administration to advance permanent legislative reform with strong bipartisan support."
In April, Trump signed an executive order to inspect and apply duties to all packages from China and Hong Kong beginning May 2.
"PeopleForBikes has advocated for reform of the de minimis threshold since 2018," said Jenn Dice, PeopleForBikes president and CEO. "This action, while temporary in nature as an executive order, is a strong signal to U.S. manufacturers, assemblers, and retailers that their concerns are being heard. It's a meaningful win for fair trade and consumer safety."
For goods shipped through the international postal system, packages instead will be assessed duties according to:
- Ad valorem duty: A duty equal to the effective tariff rate imposed under the International Emergency Economic Powers Act (IEEPA) that is applicable to the country of origin of the product. This duty shall be assessed on the value of each package.
- Specific duty: A duty ranging from $80 per item to $200 per item, depending on the effective IEEPA tariff rate applicable to the country of origin of the product. The specific duty methodology will be available for six months, after which all applicable shipments must comply with the ad valorem duty methodology.
Between 2015 and 2024, de minimis shipments entering the U.S. increased from 134 million shipments to more than 1.36 billion, according to the executive order, and on average, the Customs Border Patrol processes more than four million de minimis shipments into the U.S. daily.
