For nearly a century, a simple rule made cross-border shopping cheap and easy: if your package was worth less than a certain amount, it crossed the border duty-free, with minimal paperwork.
That era just ended — on both sides of the Atlantic.
The $800 de minimis exemption — the rule that let Americans receive low-value international shipments duty-free — has now been eliminated for every country, in two waves. China and Hong Kong lost it first, effective May 2, 2025. Then, effective August 29, 2025, the exemption was suspended for shipments from all other countries as well.
And today — July 1, 2026 — the European Union's version starts disappearing too.
Starting July 1, 2026, every low-value parcel entering the EU faces a flat €3 customs duty for the first time, with full duty assessment following in 2028 once the exemption is fully removed. TaxCloud
If you sell internationally, sell on platforms like Temu, Shein, or Amazon Global, or import products for resale, today marks a genuine turning point. Here's what changed, what it costs, and what you need to do.
The $800 de minimis rule was an exemption that allowed low-value shipments to enter the country duty-free and with minimal paperwork.
For years, it has been one of the most important mechanisms in cross-border ecommerce, allowing low-value shipments to enter markets duty-free and enabling direct-to-consumer brands to stay competitive on price. Numeral
The concept made sense administratively — processing customs paperwork on a $15 phone case isn't worth the government's time or the importer's cost. But the volume exploded. Chinese ecommerce platforms built entire business models around shipping millions of individual low-value packages directly to U.S. consumers, each one slipping under the $800 threshold and avoiding duties entirely.
For nearly a decade, cross-border sellers and platforms such as Shein and Temu leaned on the exemption to flood the U.S. with low-value packages. Meanwhile, American retailers shipping to other countries paid tariffs, hired brokers, and navigated customs compliance. Mass.gov
That asymmetry — foreign sellers avoiding duties while domestic retailers paid them — became the central argument for ending the exemption.
Feb. 1, 2025: President Trump signs executive orders imposing tariffs on Mexico, Canada, and China, citing national security concerns under the International Emergency Economic Powers Act.
May 2, 2025: De minimis ends for China and Hong Kong. Low-value imports from these countries became subject to either the applicable tariff rate or a flat postal duty.
August 29, 2025: The United States suspends duty-free de minimis treatment for shipments from all other countries as well — meaning the $800 threshold no longer applies to any country of origin.
February 2026: The administration continued the suspension by executive order, extending what had originally been framed as a temporary measure. Tax Foundation
The modifications effective February 24, 2026 included a duty equal to the rate set in a February 20, 2026 proclamation on temporary import surcharges, assessed on the value of each dutiable postal item. Galvix
What started as a targeted measure against China for fentanyl-related concerns expanded into a global policy within seven months. By 2026, there is no country whose shipments still qualify for de minimis treatment entering the United States.
By 2026, essentially every package from every country is subject to tariffs regardless of value.
For postal shipments specifically, the structure is unusual: specific duty: a flat rate per item, ranging from $80 to $200, depending on the country of origin's IEEPA tariff. CBP does not prepare entries for postal shipments. Instead, the carrier or another qualified party remits the duties monthly.
Starting February 28, 2026, carriers must use the ad valorem duty method exclusively — meaning duties calculated as a percentage of the item's value, rather than a flat per-item fee, became the standard going forward.
Shipments of up to $800 in goods from China and Hong Kong now face a 54% tariff or a $100 flat fee.
For consumers and small importers, the real-world impact has been concrete and immediate. A pair of lined slippers made in China and shipped to the U.S. that previously cost $30 now costs significantly more once duties are applied.
While the U.S. fight has been settled for months, today marks the EU's turning point.
The European Council voted to phase out the de minimis exemption on November 13, 2025, ending a key benefit that many ecommerce businesses built their models around. The rollout follows a two-phase approach. TaxCloud
Phase one — today, July 1, 2026: A flat-rate customs duty of €3 per HS code applies to every low-value parcel entering the EU. The charge is per HS code, not per package or per SKU. A parcel containing items under a single HS code triggers one €3 charge — even if those items are different SKUs. A parcel that spans two distinct HS codes triggers two €3 charges.
Phase two — mid-2028: This is when EU de minimis is fully removed. The €3 flat rate disappears, and parcels get assessed at standard import duties — the same product-specific tariff rates that apply to commercial bulk shipments today.
This is law, with a fixed start date. There is no grace period. TaxCloud
Fashion, accessories, jewelry, beauty products, home goods, and electronics under €150 will experience the most significant impact. Textiles typically face duty rates around 12%, while electronics often see lower rates of 0-5%.
If you sell direct-to-consumer into Europe and have shipments processed today without accounting for the new €3 per-HS-code charge, you're either absorbing an unexpected cost or under-charging your customers.
The EU's elimination is more aggressive than the US approach. The United States eliminated its $800 de minimis exemption in two phases — for China imports on May 2, 2025, and for all other countries on August 29, 2025. Both regions acted in response to the massive volume of low-value shipments from Chinese ecommerce platforms. TaxCloud
The U.S. approach was blunt — eliminate the threshold entirely and apply existing tariff rates immediately. The EU approach is more gradual — a small flat fee now, full duty assessment in 2028. But the destination is the same: neither region will have a meaningful duty-free pathway for low-value imports by the end of this decade.
In 2026, the era of widely accessible de minimis thresholds like the $800 limit in the US or €150 in the EU is coming to an end. Governments are shifting away from value-based exemptions and toward more consistent duty collection, stricter enforcement, and new fee structures. Numeral
Not every country has moved. Australia's AUD $1,000 threshold remains unchanged — still applies for duties and taxes unless the merchant is registered for GST under Australia's Low Value Imported Goods rules, in which case GST is collected at checkout. Singapore's SGD $400 threshold also remains unchanged, with similar GST registration rules applying.
Governments are shifting away from value-based exemptions and toward more consistent duty collection, stricter enforcement, and new fee structures. Numeral
For now, Australia and Singapore represent two of the larger remaining markets where de minimis-style thresholds persist — though both increasingly require GST registration that achieves a similar revenue-capture effect without eliminating the threshold outright.
The end of de minimis creates clear winners and losers — and they're not who you might initially expect.
Winners:
The suspension could be a boon for merchants and brands that source products in America. This is particularly true for small direct-to-consumer businesses that pay U.S. wages while competing with goods manufactured offshore in markets with extremely low labor costs. The second group to benefit could be every domestic retailer that already pays import duties. Mass.gov
For years, U.S. retailers importing in bulk and paying full duties competed against direct-to-consumer foreign sellers who avoided those same duties through de minimis. That competitive disadvantage is now gone.
Losers:
The end of de minimis will likely reduce the number of smaller international sellers able to compete in the U.S. market. Many emerging brands will find the extra costs and paperwork too burdensome to justify selling here.
Without de minimis, the final price you pay for imported goods will rise, sometimes sharply, because duties, taxes, and import fees will now be applied to every purchase. Delivery may also take longer due to increased customs processing. These changes aren't just about luxury goods — everyday items like slippers, supplements, and kitchen knives will also be hit with higher costs. Sales Tax Calculator
Consumers are the most direct losers — paying more for imported goods across nearly every category, with less product variety as smaller foreign sellers exit the U.S. market entirely.
The smartest cross-border sellers aren't waiting for further policy clarity — they're restructuring their operations now.
One of the most effective approaches is in-country enablement, often referred to as forward stocking. Rather than shipping each order individually across borders, brands import inventory in bulk into a local or regional fulfillment center. This changes the cost structure significantly. Duties are paid once, and typically on the cost of goods rather than the final retail price, which can result in substantial savings. Just as importantly, orders are fulfilled domestically, leading to faster delivery times, fewer customs delays, and a smoother post-purchase experience for customers. Numeral
For small business importers, consider these approaches: consolidate orders into larger bulk shipments to reduce per-unit brokerage costs and amortize duties and fees across more units; compare sourcing by total landed cost across origins, since de minimis no longer favors any country — the differentiators are now the tariff rate, free trade agreement eligibility, and freight cost; renegotiate supplier terms to account for duty costs by requesting Delivered Duty Paid pricing so the supplier handles customs and you get a predictable landed cost; and run the numbers on domestic sourcing or near-shoring to Mexico, where USMCA-qualifying goods enter at 0% reciprocal tariff. Tax Foundation
Here's the angle that connects directly to your sales tax obligations — and it's the piece most de minimis coverage leaves out entirely.
When tariffs increase your landed cost on imported goods, that higher cost flows into your retail price. And in most states, sales tax applies to your full retail price — including the portion that reflects the tariff you paid. We covered this in depth earlier this year: several states, including California and Wisconsin, have confirmed that tariff costs passed through to customers are included in the taxable sales price.
That means the end of de minimis doesn't just increase your costs at the border. It increases the sales tax your customers owe on every transaction, because the taxable base — your sale price — is now higher. If you're not accounting for this compounding effect in your pricing and tax calculation, you may be under-collecting sales tax on every import-dependent product you sell.
If you import goods for resale: Audit your supply chain immediately. Determine your actual landed cost under current duty rates — not the cost structure you built your pricing around before 2025. Review whether forward stocking, consolidated entry, or domestic sourcing changes your economics favorably.
If you sell direct-to-consumer into the EU: Today's €3 per-HS-code charge needs to be reflected in your European pricing and checkout experience immediately. Verify your fulfillment partner or carrier is correctly applying the charge per HS code, not per package, to avoid over-or under-charging customers.
If you sell in the U.S. and source internationally: Confirm your landed cost calculations reflect current duty rates by country of origin. The 54% rate on Chinese goods and varying rates elsewhere mean a uniform markup strategy across all suppliers no longer works.
Everyone: Review how your state treats tariff costs in your sales tax calculation. Higher landed costs mean higher retail prices, which mean higher sales tax collected — verify your systems are calculating correctly on the updated, tariff-inflated price.
Importing goods internationally or selling direct-to-consumer across borders and want to understand how the end of de minimis affects your sales tax calculations and overall compliance? Book a free consultation with our team at sales.tax. We'll review your supply chain, your pricing structure, and your sales tax obligations to make sure nothing falls through the cracks as these changes compound.