Trump’s big threat to little shipments

Summary
Closing the $800 de minimis exemption will pinch countless importers and especially low-income consumers.President Trump says his tariffs may cause “some pain" to Americans, and he’s making sure they do. He’s halting a popular customs exemption that would have helped consumers and small businesses endure the weight of heavy new import duties.
Each of Mr. Trump’s tariff orders—on China and now-paused on Mexico and Canada—bars use of the so-called de minimis exemption. The exemption lets every business or individual import up to $800 of goods duty-free each day, and it applies to almost every country. Curbing it will make sure importers pay more for small, specialized shipments.
Americans are fond of de minimis, using it to bring in more than 1.3 billion packages last year. Protectionists in both parties have wanted to curtail or kill it. President Biden took the first stab, moving to bar the exemption for certain goods, mostly from China. Mr. Trump is now extending this “no exceptions" treatment to neighboring countries, and speeding up its implementation.
Mexico and Canada are the second and third largest sources of U.S. imports, and a snap tariff on small shipments will complicate many kinds of commerce. Countless suppliers and dealers will feel the sting of going from no tariff to 25% on small components that they import.
Goods that come in under the exemption skip the normal customs screening, but treating them like other imports will cost Customs and Border Protection (CBP) about $5 per package, according to an Oxford Economics study. That adds up to hundreds of millions of dollars in costs to the government, requiring thousands more customs officers.
None of this has swayed Mr. Trump, who believes de minimis shipments are a channel for drug smuggling. His order on Canadian imports blamed the exemption for helping fentanyl flow into the U.S. Yet federal agents are effective at finding drugs stashed in legal shipments, de minimis or not. CBP reported 24,527 drug seizures from de minimis shipments in 2021.
The one-month pause on Mexico is a hopeful sign, and more relief could follow, depending on Mr. Trump’s whims. But his de minimis levies will make imported goods more expensive for millions of Americans.