President Trump issued an executive order May 12 that lowers not only the “reciprocal” tariffs the U.S. is imposing on imports from China but also the duties assessed on low-value imports from China.
Effective May 2 the U.S. eliminated the de minimis exemption for products of China (including Hong Kong), which had allowed the informal, duty-free entry of articles that have a retail value of $800 or less and are imported by one person in one day. As a result, since that date such shipments from China sent through the international postal network and transported by carriers have been subject to one of the following two duty rates, as elected by the carrier: (1) 120 percent of the value of the postal item containing goods, or (2) $100 per postal item containing goods.
However, Trump has now lowered the first amount from 120 percent to 54 percent, effective with respect to goods entered or withdrawn from warehouse for consumption on or after 12:01 a.m. EDT on May 14. The alternative per item charge remains at $100 but will not increase to $200 on June 1 as previously specified.
These duties are in lieu of any other duties to which such shipments would otherwise be subject, including the 20 percent tariffs imposed in response to concerns about fentanyl and illegal immigration, most-favored nation duties established in the HTSUS, and Section 301 tariffs. They also apply to subject shipments even if they are shipped from China or Hong Kong to another country and then transported to the U.S.
Low-value shipments from China sent through means other than the international postal network are subject to all applicable duties (e.g., reciprocal tariffs (which have been lowered to 30 percent total for China; see link above), Section 301 tariffs, etc.), taxes, and fees and must be entered under an appropriate entry type (e.g., 01 or 11) in the Automated Commercial Environment by a party qualified to make entry.
ST&R offers a three-pronged approach to avoiding, mitigating, and/or recovering import tariffs. For more information on which of these strategies might be most effective for your business, please contact ST&R.
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