Overseas Fashion Brands like Shein/Temu Exploit a U.S. Tariff Loophole Hurting US brands
Overseas Fashion Brands like Shein/Temu Exploit a U.S. Tariff Loophole Hurting US brands
The Issue
US owned brands importing goods in bulk must pay import duties and customs fees based on the total shipment value, as their orders exceed the de minimis threshold of $800. In contrast, foreign direct-to-consumer brands like Shein and Temu ship individual orders under $800, allowing them to bypass these fees and gain a cost advantage.
Packages entering the U.S. through USPS under the de minimis threshold (currently $800) are typically processed with no customs duties and taxes, allowing for faster clearance. These shipments bypass formal customs entry requirements, moving directly through USPS’s international processing centers for final delivery.
The Trade Facilitation and Trade Enforcement Act of 2015, signed by President Obama, raised the de minimisthreshold from $200 to $800 to streamline low-value imports and boost e-commerce. However, it has backfired by giving foreign retailers like Shein and Temu a tax advantage, allowing them to flood the U.S. market with duty-free goods while domestic wholesalers still face import tariffs.
I stand as a representation of numerous suffering wholesale brands who are struggling to stand a chance against foreign magnates like Temu and Shein. The issue at hand has to do with the application of de minimis rules for packages that come through shipping from other countries directly to consumers.
At present, our current system allows foreign companies to import small quantities of goods directly to consumers without paying customs duties, essentially sidelining local producers & wholesalers. Providing the foreign companies with an unwarranted price advantage over US brands. This loophole is directly causing substantial diminished sales for our domestic wholesalers & brands, particularly when pertaining to products that can be imported in small quantities.
The compounded impact of this economic disparity is critical. For instance, wholesale trade contributes approximately $5.9 trillion to U.S. GDP, employing 5.8 million individuals here at home (Source: U.S. Census Bureau, Economic Statistics). By allowing foreign companies to bypass the customs duties imposed on wholesalers, we're jeopardizing these businesses, employment, and our economy at large.
Our call to action is simple - to reassess and reduce the de minimis minimum for packages being shipped in from overseas to ensure a balanced trade environment. By doing so, sales for domestic wholesalers would have a chance to regain footing and thrive in the competitive market.
Taking steps to protect our local businesses and maintain healthy competition is crucial for the continual economic prosperity of our country. Please sign this petition as a step toward supporting our local wholesalers and sustaining fair commercial practices.
Supporting article:
14
The Issue
US owned brands importing goods in bulk must pay import duties and customs fees based on the total shipment value, as their orders exceed the de minimis threshold of $800. In contrast, foreign direct-to-consumer brands like Shein and Temu ship individual orders under $800, allowing them to bypass these fees and gain a cost advantage.
Packages entering the U.S. through USPS under the de minimis threshold (currently $800) are typically processed with no customs duties and taxes, allowing for faster clearance. These shipments bypass formal customs entry requirements, moving directly through USPS’s international processing centers for final delivery.
The Trade Facilitation and Trade Enforcement Act of 2015, signed by President Obama, raised the de minimisthreshold from $200 to $800 to streamline low-value imports and boost e-commerce. However, it has backfired by giving foreign retailers like Shein and Temu a tax advantage, allowing them to flood the U.S. market with duty-free goods while domestic wholesalers still face import tariffs.
I stand as a representation of numerous suffering wholesale brands who are struggling to stand a chance against foreign magnates like Temu and Shein. The issue at hand has to do with the application of de minimis rules for packages that come through shipping from other countries directly to consumers.
At present, our current system allows foreign companies to import small quantities of goods directly to consumers without paying customs duties, essentially sidelining local producers & wholesalers. Providing the foreign companies with an unwarranted price advantage over US brands. This loophole is directly causing substantial diminished sales for our domestic wholesalers & brands, particularly when pertaining to products that can be imported in small quantities.
The compounded impact of this economic disparity is critical. For instance, wholesale trade contributes approximately $5.9 trillion to U.S. GDP, employing 5.8 million individuals here at home (Source: U.S. Census Bureau, Economic Statistics). By allowing foreign companies to bypass the customs duties imposed on wholesalers, we're jeopardizing these businesses, employment, and our economy at large.
Our call to action is simple - to reassess and reduce the de minimis minimum for packages being shipped in from overseas to ensure a balanced trade environment. By doing so, sales for domestic wholesalers would have a chance to regain footing and thrive in the competitive market.
Taking steps to protect our local businesses and maintain healthy competition is crucial for the continual economic prosperity of our country. Please sign this petition as a step toward supporting our local wholesalers and sustaining fair commercial practices.
Supporting article:
14
The Decision Makers
Petition created on January 27, 2025