The rule that allows American tourists to bring back souvenirs from overseas duty-free is now being used by companies to avoid billions of dollars in tariffs — and it’s perfectly legal, the Wall Street Journal reported. Known as the de minimis rule, the exemption has been around for decades, deriving its name from the Latin term for something too small to fuss with. For many years, it was just that — accounting for such a sliver of imports that U.S. Customs and Border Protection didn’t even bother to keep track of them. It’s a sliver no more. The known value of de minimis imports soared to over $67 billion in 2020 from an estimated $40 million in 2012, according to previously unreported U.S. Customs data. The rise of e-commerce in recent years accustomed shoppers to order just a few items at a time — which easily falls under the de minimis rules — and led to steady growth in such shipments. Then a sharp jump came in the wake of higher tariffs imposed by the Trump administration on Chinese imports, according to the Customs data and logistics industry executives, who say the new levies led importers to devise ways to dodge paying them. As a result, more than a tenth of Chinese imports by value now arrive as de minimis shipments, the Customs data indicate, up from well under 1% a decade ago. The increase was also fueled by a 2016 decision by Congress to raise the maximum value of de minimis imports to $800, up from $200. The law allows U.S. retailers who sell Chinese imports — along with Chinese companies that sell directly to U.S. consumers — to avoid tariffs on goods as long as they are packaged and addressed to individual buyers and fall below the $800 cap.
