Pressure is Growing to Lower the $800 de Minimis Threshold
In this video from The Franklin Partnership, contributing author Omar Nashashibi explains the de minimis threshold and how any possible changes could impact importers and domestic manufacturers of merchandise valued at $800 or less.
Congress has held multiple hearings this year that included discussion about lowering the current $800 de minimis threshold for duty-free imports of merchandise. This comes as lawmakers are investigating imports from China under de minimis, and members of the public are raising awareness over illicit drugs and counterfeit goods entering the US.
In February 2015, then President Obama signed the Trade Facilitation and Trae Enforcement Act into law, raising the definition of a de minimis shipment of imported merchandise from $200 or less to $800 or less. (https://www.cbp.gov/newsroom/national-media-release/de-minimis-value-increases-800)
According to the U.S. Customs and Border Protection, total value of de minimis goods entering the U.S. between 2018 and 2021 was $192 billion. (https://www.cbp.gov/sites/default/files/assets/documents/2022-Oct/FY2018-2021_De%20Minimis%20Statistics%20update.pdf)
De minimis shipments entering the U.S. under Section 321 are imported duty free, except for merchandise subject to antidumping and countervailing duties, quotas, or special taxation such as alcohol. (https://www.cbp.gov/trade/basic-import-export/e-commerce/faqs)
Several of the congressional committee hearings on the de minimis exemption focused on enforcement at the Department of Homeland Security, screening for forced labor products, and how some importers from China break up shipments to keep their value below the $800 daily limit to enter the U.S. tax or duty free. (https://selectcommitteeontheccp.house.gov/sites/evo-subsites/selectcommitteeontheccp.house.gov/files/evo-media-document/6.28.2023-letter-to-usps-china-select-oversight-cmte.pdf)
Some leading lawmakers on Capitol Hill do believe that legislation lowering the de minimis threshold is possible in this Congress.
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Jennifer Clement is an executive sales and marketing leader specializing in value creation for the C-suite. In her current role at CLA, Jennifer collaborates on strategy with executives of global manufacturing and distribution companies to accelerate results. Previously Jennifer served as a Global Business Acceleration Leader for Complete Manufacturing and Distribution (CMD). During her time with CMD, Jennifer lived and worked in Asia from 2015-2019. Prior to CMD, she spent 10 years in senior care technology. Jennifer started her career at Johnson Controls (JCI) and spent nine years in leadership roles; followed by five years at Rockwell Automation (ROK) leading c-suite strategy and marketing operations.
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