Duty-free no more: Parcels worth under $800 no longer qualify for a US tariff exemption

NEW YORK (AP) — Low-value imports lost their duty-free status in the United States on Friday as part of President Donald Trump's agenda for making the nation less dependent on foreign goods and resetting global trade with tariffs.

An executive order eliminated a widely used customs exemption for international shipments worth $800 or less as of 12:01 a.m. Eastern Daylight Time, nearly two years earlier than the deadline set in the tax cuts and spending bill approved by Congress.

Saying they received too little time and information to start collecting duties on small parcels, the national postal services of more than 30 countries have temporarily suspended sending some or most U.S.-bound packages. They include the mail systems of Australia, New Zealand, India, Japan, Mexico, Thailand and almost every country in Europe.

Purchases that previously entered the U.S. without needing to clear customs will require vetting and be subject to their origin country's applicable tariff rate, which can range from 10% to 50%. For the next six months, mail carriers can instead apply a flat duty of $80 to $200 to packages sent through the global postal network. After that, both mailed parcels and those handled by private courier services will be subject to the value-based tariff rate.

Although the president previously ended the “de minimis” rule for inexpensive items sent from China and Hong Kong, having to pay import taxes on small parcels from everywhere else likely will be a big change for some small businesses and online shoppers. In addition to bringing new costs, the withdrawal of duty-free treatment is likely to delay orders, according to logistics experts.

The Trump administration says the exemption has become a loophole that foreign businesses exploit to evade tariffs and criminals use to get drugs, counterfeit products and other contraband into the U.S. Former President Joe Biden and members of Congress also discussed the issue.

Other countries have similar exemptions, but the threshold is usually lower. For example, 150 euros ($175) is the value limit in the 20 European Union countries that use the euro as their official currency. The U.K. allows foreign businesses to send parcels worth up to 135 pounds ($182) without incurring tariff charges.

In the U.S., the “de minimis” — Latin for lacking significance or importance — exemption started in 1938 as a way to save the federal government the time and expense of collecting duties on imported goods with a retail value of $1 or less. U.S. lawmakers eventually increased the eligibility cutoff to $5 in 1990, to $200 in 1993 and to $800 in 2015, according to the Congressional Research Service.

Since then, the number of shipments claiming de minimis treatment has exploded. A total of 1.36 billion packages with a combined value of $64.6 billion reached the U.S. last year, compared to 134 million packages sent under the exemption in 2015, the U.S. Customs and Border Protection agency reported.

About 60% of the 2024 shipments came from China and Hong Kong, according to an analysis logistics firm Flexport prepared based on U.S. government data. Multiple countries and regions accounted for the remainder, including Canada, Mexico, the European Union, India and Vietnam.

Proponents of limiting the exemption argue that it has served as a way for China-founded retail platforms like Temu and Shein to flood the U.S. with low-priced goods. The National Council of Textile Organizations said the move would help close a "backdoor pipeline for cheap, subsidized, and often illegal, toxic and unethical imports.” But some smaller American companies that rely on imported products and materials benefited from the exemption too.

Kristin Trainor is worried the end of de minimis will also mean the end of Diesel and Lulu's, her 3-year-old boutique in Avon, Connecticut. Over 70% of the women's clothes and accessories she stocks comes from small fashion houses in France, Italy and Spain. Trainor places small batch orders each week that fall under the $800 threshold.

“Our business model is to provide casual chic and unique clothes at affordable prices,” she said. “The added customs and duty charges that will go into effect on Aug. 29 will eliminate that affordability. ”

Trainor said she was looking to replace her European vendors with ones based in the U.S. But her bestselling product categories, such as apparel made of Italian linen, come from other countries. She estimates a simple linen sundress that cost $30 wholesale at the beginning of the year will rise to $43 next month.

After a corporate career, Trainor opened the store to have more time with her 9-year-old son and her 91-year old father. Raising the boutique’s prices to absorb part of the import charges would help offset higher shipping and logistics costs, but Trainor worries her customers will balk at higher prices.

“I have not made any official announcements to my customers just yet, although they have started to ask if I will stay open as they understand the economic impacts that are occurring,” she said. “At this point, I am leaning more and more towards closing the boutique, sadly.”

Ken Huening started CoverSeal, his business making and selling protective covers for cars, motorcycles, grills and patio furniture, in 2020. The company is based in Los Gatos, California, and the covers are manufactured in Mexico and China. When a customer places an order, it ships from Mexico.

Although a trade agreement that took effect in 2020 has made most goods from Mexico and Canada exempt from country-specific U.S. tariffs, the withdrawal of the de minimis rule applies to all countries.

Huening said he'll either have to raise prices or end free shipping now that his products will be taxed when they are sent from Mexico to U.S. customers. He's looked at setting up a U.S. production and logistics network but says domestic sewing facilities and textile manufacturers do not exist for the engineered fabric used in CoverSeal's products.

“We are often asked why we don’t just establish a U.S. supply chain,” he said. “It is not possible in the short term. By the time the infrastructure is established, many companies and small businesses will be out of business.”

Shannen Knight imports hard-to-find sports goggles and glasses as the owner of A Sight For Sport Eyes, her online store and shop in West Linn, Oregon. She routinely received shipments from the U.K., the Netherlands and Italy that fell under the de minimis dollar cutoff.

Knight estimated that she would need to raise the retail price of the rugby goggles she gets from Italy by 50%. It took the International Rugby Board two years of testing to approve the Italian-made goggles, a specialty item without strong prospects for stateside production, she said.

“There are products that it just makes sense to be made internationally, where there is the stronger demand for them, but there still is some demand for in the U.S.," Knight said.

CORRECTS COMPANY NAME: Shannen Knight, owner of A Sight For Sport Eyes, a brick-and-mortar and ecommerce store for sport goggles, looks on while talking about the store on Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

CORRECTS COMPANY NAME: A UPS driver gets into their vehicle after delivering packages at A Sight For Sport Eyes, a brick-and-mortar and e-commerce store for sport goggles, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

CORRECTS COMPANY NAME: Rugby eye-ware made by the Italian brand Raleri is displayed at A Sight For Sport Eyes, a brick-and-mortar and e-commerce store for sport goggles, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

CORRECTS COMPANY NAME: Amanda Follett works on packages at A Sight For Sport Eyes, a brick-and-mortar and e-commerce store for sport goggles, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

CORRECTS COMPANY NAME: Amanda Follett opens packages at A Sight For Sport Eyes, a brick-and-mortar and e-commerce store for sport goggles, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

Shannen Knight, owner of A Sight For Sore Eyes, a brick-and-mortar and ecommerce store for sport goggles, looks on while talking about the store on Wednesday, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

Rugby eyeware made by the Italian brand Raleri is displayed at A Sight For Sore Eyes, a brick-and-mortar and ecommerce store for sport goggles, Wednesday, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

A UPS driver gets into their vehicle after delivering packages at A Sight For Sore Eyes, a brick-and-mortar and ecommerce store for sport goggles, Wednesday, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

Amanda Follett works on packages at A Sight For Sore Eyes, a brick-and-mortar and ecommerce store for sport goggles, Wednesday, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

Amanda Follett opens packages at A Sight For Sore Eyes, a brick-and-mortar and ecommerce store for sport goggles, Wednesday, Aug. 20, 2025, in West Linn, Ore. (AP Photo/Jenny Kane)

NUUK, Greenland (AP) — Troops from several European countries, including France, Germany, the UK, Norway and Sweden, are arriving in Greenland in a show of support for Denmark as talks between representatives of Denmark, Greenland and the U.S. on Wednesday highlighted “fundamental disagreement” between the Trump administration and European allies on the future of the Arctic island.

Denmark announced it would increase its military presence in Greenland on Wednesday and several European partners started sending symbolic numbers of troops on that day, just as the Danish and Greenlandic foreign ministers were preparing to meet with White House representatives in Washington.

The troop movements were intended to portray unity among Europeans and send a signal to U.S. President Donald Trump that an American takeover of Greenland is not necessary as NATO together can safeguard the security of the Arctic region amid rising Russian and Chinese interest.

“The first French military elements are already en route” and “others will follow,” French President Emmanuel Macron announced Wednesday, as French authorities said about 15 soldiers from the mountain infantry unit were already in Nuuk for a military exercise.

Germany will deploy a reconnaissance team of 13 personnel to Greenland on Thursday, its Defense Ministry said.

On Thursday, Danish Defense Minister Troels Lund Poulsen said the intention was “to establish a more permanent military presence with a larger Danish contribution,” according to Danish broadcaster DR. He said soldiers from several NATO countries will be in Greenland on a rotation system.

Danish Foreign Minister Lars Løkke Rasmussen, flanked by his Greenlandic counterpart Vivian Motzfeldt, said Wednesday that a “fundamental disagreement” over Greenland remains with Trump after they held highly anticipated talks at the White House with Vice President JD Vance and Secretary of State Marco Rubio.

Rasmussen added that it remains “clear that the president has this wish of conquering over Greenland” but that dialogue with the U.S. would continue at a high level over the following weeks.

Inhabitants of Greenland and Denmark reacted with anxiety but also some relief that negotiations with the U.S. would go on and European support was becoming visible.

In Greenland’s capital, Nuuk, local residents told The Associated Press they were glad the first meeting between Greenlandic, Danish and American officials had taken place but suggested it left more questions than answers.

Several people said they viewed Denmark’s decision to send more troops, and promises of support from other NATO allies, as protection against possible U.S. military action. But European military officials have not suggested the goal is to deter a U.S. move against the island.

Maya Martinsen, 21, agreed and said it was “comforting to know that the Nordic countries are sending reinforcements” because Greenland is a part of Denmark and NATO.

The dispute, she said, is not about “national security” but rather about “the oils and minerals that we have that are untouched.”

On Wednesday, Poulsen had announced a stepped-up military presence in the Arctic “in close cooperation with our allies,” calling it a necessity in a security environment in which “no one can predict what will happen tomorrow.”

“This means that from today and in the coming time there will be an increased military presence in and around Greenland of aircraft, ships and soldiers, including from other NATO allies,” Poulsen said.

Asked whether the European troop movements were coordinated with NATO or what role the U.S.-led military alliance might play in the exercises, NATO referred all questions to the Danish authorities. However, NATO is currently studying ways to bolster security in the Arctic.

Rasmussen, the Danish foreign minister, announced the creation of a working group with the Americans to discuss ways to work through differences.

“The group, in our view, should focus on how to address the American security concerns, while at the same time respecting the red lines of the Kingdom of Denmark,” he said.

Commenting on the outcome of the Washington meeting on Thursday, Poulsen said the working group was “better than no working group” and “a step in the right direction.” He added nevertheless that the dialogue with the U.S. did not mean “the danger has passed.”

“We are really happy that action is being taken to make sure that this discussion is not just ended with that meeting alone,” Greenlandic MP Aki-Matilda Høegh-Dam said on Thursday during a news conference in Copenhagen.

She said Greenlandic people understood they were a “pivotal point” in a broader transformation of the international rules-based order and that they felt responsible not just for themselves but also for the whole world to get it right.

Høegh-Dam said the military operations should not happen “right next to our schools and right next to our kindergartens.”

Line McGee, a 38-year-old from Copenhagen, told AP that she was glad to see some diplomatic progress. “I don’t think the threat has gone away,” she said. “But I feel slightly better than I did yesterday.”

Speaking to FOX News Channel’s Special Report on Wednesday after the White House talks, Rasmussen rejected both a military takeover and the potential purchase of the island by the U.S. Asked whether he thinks the U.S. will invade, he replied: “No, at least I do not hope so, because, I mean, that would be the end of NATO.”

Rasmussen said Greenlanders were unlikely to vote for U.S. rule even if financial incentives were offered, “because I think there’s no way that U.S. will pay for a Scandinavian welfare system in Greenland, honestly speaking.”

“You haven’t introduced a Scandinavian welfare system in your own country,” he added.

Trump, in his Oval Office meeting with reporters, said: “We’ll see how it all works out. I think something will work out.”

Niemann reported from Copenhagen, Denmark, and Ciobanu from Warsaw, Poland.

Denmark's Foreign Minister Lars Løkke Rasmussen and Greenland's Foreign Minister Vivian Motzfeldt speak at a news conference at the Embassy of Denmark, Wednesday, Jan. 14, 2026, in Washington. (AP Photo/John McDonnell)

People walk on a street in Nuuk, Greenland, Wednesday, Jan. 14, 2026. (AP Photo/Evgeniy Maloletka)

From center to right, Greenland Foreign Minister Vivian Motzfeldt, Denmark's Ambassador Jesper Møller Sørensen, rear, and Danish Foreign Minister Lars Løkke Rasmussen, right, arrive on Capitol Hill to meet with senators from the Arctic Caucus, in Washington, Wednesday, Jan. 14, 2026. (AP Photo/J. Scott Applewhite)

An Airbus A400M transport aircraft of the German Air Force taxis over the grounds at Wunstorf Air Base in the Hanover region, Germany, Thursday, Jan. 15, 2026 as troops from NATO countries, including France and Germany, are arriving in Greenland to boost security. (Moritz Frankenberg/dpa via AP)

Fishermen load fishing lines into a boat in the harbor of Nuuk, Greenland, Wednesday, Jan. 14, 2026. (AP Photo/Evgeniy Maloletka)

Greenland Foreign Minister Vivian Motzfeldt, left, and Danish Foreign Minister Lars Løkke Rasmussen, arrive on Capitol Hill to meet with members of the Senate Arctic Caucus, in Washington, Wednesday, Jan. 14, 2026. (AP Photo/J. Scott Applewhite)