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Guide to the De Minimis Exemption Suspension
Understanding the Impact on International Shipping and E-commerce
What is the De Minimis Exemption?
The de minimis provision has allowed goods valued at under $800 to be imported into the U.S. duty-free, bypassing standard customs procedures. This has been a major advantage for e-commerce businesses and small sellers, enabling faster shipping and lower costs.
What's Changing?
The de minimis exemption is being suspended globally, effective August 29, 2025. This change is based on a presidential executive order, which you can read here for full details. This means that most shipments previously entering the U.S. duty-free will now be subject to full tariffs, taxes, and new documentation requirements.
Key Dates You Need to Know
- August 29, 2025: The global suspension of the de minimis exemption takes effect.
- 6-Month Grace Period (for postal shipments): International postal shipments will have a temporary grace period, using simplified, flat-rate tariffs based on the country of origin (ranging from $80-$200 per item, depending on country of origin).
- July 1, 2027: The One Big Beautiful Bill Act (OBBBA) permanently repeals the de minimis exemption.
Checklist for Businesses Affected by the De Minimis Changes
To prepare for the new regulations, we've created a checklist to help your business stay compliant and competitive.
1. Understanding the Financial Impact
Review Your Pricing Strategy:
- Calculate the new landed cost for your products, factoring in applicable tariffs and taxes.
- Assess if you need to adjust your retail prices to maintain profit margins.
- Consider transparent pricing that shows the customer the full landed cost at checkout
Analyze Your Product Categories and Origins:
- Determine which of your products will be most affected by the new tariffs based on their category (e.g., apparel, electronics) and country of origin.
- Identify the specific tariff rates and applicable taxes for those affected products, as these can vary widely and will significantly impact your final landed cost.
2. Adjust Your Logistics and Fulfilment Strategy
Re-evaluate Your Shipping Model:
- For low-value shipments, cross-border shipping will become more complex and costly.
- Consider a U.S. fulfilment strategy. By importing goods in bulk, you can clear customs once and then ship domestically, avoiding the new per-shipment tariffs and ensuring faster delivery times.
Prepare for New Customs Processes:
- All shipments, regardless of value, will now require formal customs entry.
- Ensure your carriers have valid international carrier bonds.
- Work with a customs broker or a logistics partner, like Woodland Group, who can help you manage the complex entry filing process.
3. Ensure Documentation and Compliance
Update Your Documentation:
- Each shipment must be filed using the Automated Commercial Environment (ACE) system.
- Ensure all documentation, including commercial invoices, is accurate and complete.
- Accurately declare the country of origin for all products.
Avoid Penalties:
- The U.S. government is cracking down on attempts to evade tariffs.
- Be aware of the penalties for non-compliance, which can include fines of up to $5,000 for the first offense and $10,000 for each repeat offense.
4. Leveraging Strategic Shipping Solutions
A key strategy will be to shift from individual, D2C parcel shipping to bulk air and ocean freight. By consolidating orders into a single shipment, you significantly reduce your per-parcel cost. This approach lowers not only freight expenses but also customs clearance costs on a per-unit basis. Here's how we can help:
- Strategically Located U.S. Warehouses: Our warehouses in Illinois and New Jersey are perfectly positioned to receive bulk air and ocean freight. We provide efficient pick-and-pack services for last-mile delivery to your U.S. customers.
- In-House Customs Brokerage: Our dedicated team of licensed customs brokers will manage all the complex customs clearance paperwork and formal entries for your bulk shipments.
- Global Tracking and Visibility: Our powerful online tools provide full, end-to-end visibility of your shipments, from the moment they leave their origin to the final delivery to your customer's door.
Ready to Adapt to the New Rules?
Don't let the end of the de minimis exemption disrupt your business. The best way to navigate these changes is to prepare now with a partner who understands the new regulations. With our established US presence and dedicated teams across the country, we have the on-the-ground knowledge to help.
Arrange your Free Consultation Today:
Schedule a no-obligation call with our team to review your supply chain strategy and explore how a bulk freight and U.S. warehousing solution can help you maintain profitability and navigate the new regulations.
What is the de minimis exemption, and why is it changing?
The de minimis exemption has been a U.S. customs rule allowing commercial shipments valued at $800 or less to enter the country duty-free and with minimal customs paperwork. The U.S. government is suspending this rule to address concerns about a "loophole" that has been exploited for tariff evasion, the trafficking of illicit goods, and unfair competition against domestic businesses.
When does the suspension take effect, and what happens to my shipments?
The global suspension of the de minimis exemption for all countries is effective as of August 29, 2025. After this date, all commercial shipments to the U.S. will be subject to applicable duties, tariffs, and a full customs clearance process, regardless of their value.
How will this change impact my product pricing and costs?
Your product's landed cost—the total cost to get it to the customer's door—will increase. You will now have to factor in new costs, including customs duties, tariffs, and potential customs brokerage fees on every order, which may require you to adjust your pricing strategy.
How do I calculate the new duties I will owe?
The duties will be based on the product's classification (Harmonized Tariff Schedule or HTS code), its value, and its country of origin. This is a complex process, and the most reliable way to ensure accurate calculations is to work with a customs compliance partner.
Which industries and business models will be most affected?
Any business that ships a high volume of low-value goods directly to U.S. customers will feel the greatest impact. This includes sectors like fast fashion, small electronics, cosmetics, and craft goods. Business models that rely on direct-to-consumer shipping, such as dropshipping, will be especially affected as every individual order will now face duties and customs processing.
Will this change impact my shipping times and customer experience?
Yes. The requirement for full customs clearance on all shipments could lead to longer processing times at the border and a greater risk of delays. This may affect your delivery promises and lead to an increase in customer service inquiries about their orders.
How can my business adapt to these new rules?
To mitigate the impact, you can transition to a bulk import model. By consolidating your shipments and importing a large volume of products to a U.S. fulfillment center, you can clear customs once and then fulfill domestic orders, avoiding per-parcel duties and ensuring faster, more predictable delivery times.
How can a supply chain partner help me navigate these changes?
A strategic partner, like Woodland Group, can help you transition to a bulk freight model, manage all customs brokerage with in-house experts, and provide U.S.-based fulfillment services. This comprehensive approach ensures compliance, reduces per-parcel costs, and helps you maintain profitability in a post-de minimis world.
