The White House has issued a sweeping executive order that eliminates the longstanding “de minimis” duty-free exemption for low-value imports, effective August 29, 2025. Under 19 U.S.C. §1321(a)(2)(C), shipments valued at $800 or less per person per day were previously allowed into the U.S. without duties or formal customs processing.

CBP reports that the volume of de minimis shipments grew from 134 million in 2015 to more than 1.36 billion in 2024. However, government data also show that 90 % of cargo seizures in FY24 originated as de minimis shipments, including 98% of narcotics seizures.

To close what the administration calls a “catastrophic loophole,” the new order removes duty-free treatment for all commercial imports regardless of value, country of origin or mode of transport. Low-value entries will now require formal customs entry in the Automated Commercial Environment, and duties will apply at the effective IEEPA tariff rate.

There is a temporary carve‑out for packages shipped through the international postal system; carriers must either collect an ad valorem duty based on the applicable tariff or charge a flat fee of $80–$200 per parcel, depending on the origin country’s tariff rate. After six months, all postal shipments must use the ad valorem method.

Personal exemptions, $200 for returning travelers and gifts valued under $100, remain intact

For supply‑chain leaders in e‑commerce, pharmaceuticals, automotive and CPG sectors, this action signals a major shift. Every low-value cross-border shipment will soon need to be treated like a traditional import, with corresponding paperwork, duties and potential delays. Businesses should assess how this change affects land costs, fulfillment strategies and customer pricing. The policy aims to curb duty evasion and stem the flow of illicit goods, but it will also require proactive planning to maintain efficiency and customer satisfaction.

Under U.S. customs law, the de minimis exemption in 19 U.S.C. §1321(a)(2)(C) allows shipments of goods with a total value of $800 or less per person per day to enter the United States free of duties, taxes and most customs procedures. This simplified clearance, often referred to as the “Section 321 exemption”, was designed to reduce the administrative burden on U.S. Customs and Border Protection (CBP) for processing low‑value parcels and to give consumers easy access to small international purchases.

Exemption has become wildly popular in the age of e‑commerce: according to CBP data cited in a White House fact sheet, the volume of de minimis shipments jumped from 134 million shipments in 2015 to more than 1.36 billion in 2024. In fiscal year 2025 alone (through 30 June) CBP had already processed 309 million such shipments. On average, over four million de minimis parcels arrive every day.

Although the exemption simplifies trade, it has also created what the Administration calls a “catastrophic loophole”. Smaller shipments receive less scrutiny than formal entries, and the White House notes that shippers have exploited the exemption to evade duties and import illicit fentanyl, precursors and counterfeit goods into the United States.

Enforcement data show that 90 % of cargo seizures in FY24 originated as de minimis shipments, including 98 % of narcotics seizures and 97 % of intellectual‑property‑rights seizures.

With the suspension of de minimis duty-free treatment, importers face a new layer of complexity in customs clearance, documentation, and cost forecasting. At GLC, our fully licensed Customs Brokerage team and global freight forwarding network are equipped to guide you through every requirement, minimizing risk, avoiding costly delays, and ensuring compliance. Whether you need classification consulting, duty drawback support, or an end-to-end fulfillment strategy, we turn challenges into streamlined solutions.

If you have questions about how these changes impact your business, connect with us today at glc-inc.com, and move forward with confidence.