Last week, President Trump pumped the brakes with a pledge to close import tax exemptions from China on cheap consumer goods.
The suspension opens another front in the president's promised trade war, but the delays that close the so-called minimal loophole are now closed, and the preparations and policy groups head on the chaotic start of Trump's trade overhaul I'm in a hurry to re-raw it.
“We are clearly not satisfied with this delay,” Nick Iacobella, vice president of the Prosperous American Confederation, a group defending US manufacturers, told Hill.
Iacovella said that the suspension to suspend the De Minimis rule could be US tax-free and with minimal inspection, representing opening salvo in the trade war, with a complete He said the implementation is likely to represent everything Trump's ministers. Picks are placed.
The Senate Committee last week proceeded with the appointment of Cantor Fitzgerald CEO Howard Lutnick, serving as Commerce Secretary, and teeed a full room confirmation vote.
Once confirmed as expected in the GOP-controlled Senate, Lutnick will play a key role in both implementing Trump's tariffs and overseeing enforcement.
“With De Minimis' decision, there's a realization that it's really important to have your people set up, even though we want to move as quickly as possible,” Iacovella said. “If we come up with actions that would ban China from de Minimis, this is definitely the right policy move.
Earlier this month, Trump ordered “tax-free de minimis treatment… is not available” because it provided the US with illegal shipping of drugs like fentanyl and helped create a “public health crisis.” .
But Trump I pulled an order Last week we will suspend until “the right systems are fully and properly handled and the right systems are in place to collect customs revenue.”
De Minimis exemptions avoid taxes on cheap consumer goods used by e-commerce companies such as Amazon and Temu, made in China and other countries, and shipped to the US
According to the Congressional Research Service, De Minimis entries have skyrocketed over the past decade, up from 153 million in 2015 to over 1 billion in 2023.
However, De Minimis imports are a broader exemption subcategory known as “unofficial entries” related to shipments to the US worth up to $2,500, and trade advocates take action to stop the fentanyl flow. They say they need to.
“Unless all commercial shipments require formal admission, daily floods of millions of small packages still overwhelming even inspections or enforcement of tariffs,” says Lori, director of advocacy group Rethink Trade. Wallach wrote in his social media commentary.
Requiring official entry to Chinese imports means that goods will not arrive in the US in small packages processed by US mail or commercial airlines such as UPS or FedEx, but US authorities say It may arrive through a shipping container that can be processed.
“Staff will be imported into a shipping container with complete customs information submitted online for two days (where the item is manufactured, customs code, etc.). [before] Arrival at US port [Customs and Border Protection] …You can take risks and decide what to draw for the test.
Some economists disagree, claiming that the perceptible price increase that arises from ending the De Minimis rule has encouraged Trump to keep it up.
“Consumers will notice the costs of these tariffs… and will soon realize that our consumers, not foreigners, will pay the tariffs. UBS economist Paul Donovan said in an analysis on Monday. I wrote in Monday's analysis in contrast to the expected steel and aluminum imports from the White House on Monday.
Both Donovan and Wallach noted that Trump had a prominent view of many of his tariff proposals, particularly imports from Canada and Mexico, in his presidential election.
“Trump risks becoming a boy who screamed tariffs,” Wallach observed.
The suspension of drug trafficking was the main focus of Trump's second term trade strategy and the rationale for his latest trade proposal.
Trump cited the smuggling of fentanyl in an order to implement new tariffs on Mexico and Canada under the International Emergency Economic Force Act. This is a law that allows the president to implement tariffs immediately in response to obvious threats to national security.
“This is not a trade war – this is a drug war,” said Kevin Hassett, chairman of the White House Economic Advisors Council, about Trump's tariff proposals on Canada and Mexico. Interview with CNBC last week.
“We're serious about chasing fentanyl, and President Trump means that. All of this fentanyl is being shipped across the border,” Hassett continued. “In the past, there have been caravans of people carrying drugs across our borders. The response from our neighbors is not, “Hey, I'm going to help stop this issue.” . Instead, it means “go ahead and create a wall.” ”
But serious Trump is to stop the de minimis exemption, and such a move is suitable for the job of stopping drug smugglers, but this measure has already raised questions about the retail sector's long-standing business model. , a trade expert told Hill. .
“Many e-commerce companies have developed around law,” Clark Packard, a researcher at the Department of Trade Policy at the Cato Institute, told Hill. “It's kind of like a consumer [business]you have not had a one ton warehouse. [Orders can get filled] immediately. ”
Supporters also told Hill that traditional thinking about trade is in the process of change. This is the point Trump took to the campaign trail while pushing tariffs.
“Free trade does not exist in real words,” Iacobella said. “If you're in your micro-economy class and you want to discuss the costs of free trade and opportunities, that's fine. But these are theories that don't really apply to the real world, and you're the ones that you're the ones that don't really apply to the real world. There are countries like that, and they decided to overproduce and dump global supplies.”
