Temu, Shein Brace For Impact As Trump's Tariff Torpedo Blows Up The $800 Loophole

The party's over for dirt-cheap Chinese fashion hauls. President Donald Trump just closed the "de minimis" loophole, a trade exemption that allowed foreign e-commerce titans like Temu and Shein to ship low-cost packages (under $800) into the U.S. tariff-free.

Now, it's 90% duties or $75 per item. Come June 2025, that jumps to a scorching $150.

Read Also: PDD Stock Eyes Golden Cross As Temu’s Growth Battle Heats Up

Trump Closes The Door, Then Slams It

Trump didn't just end the exemption. He tripled the planned levy in a move aimed at countering China's retaliatory tariffs and, officially, to crack down on the flow of synthetic opioids like fentanyl. His executive order, signed last week, targets shipments from China and Hong Kong outside the international postal system.

These low-value parcels, which previously enjoyed a duty-free ride into American closets, now face a brutal cost hike.

The Commerce Department claims it is finally equipped to process and collect tariff revenue on these micro shipments, declaring the systems are "ready."

Ready or not, the bill is coming due.

Retail Fallout Is Already Here

Forever 21, now liquidating its stores, blamed Temu and Shein's ultra-low prices for gutting its customer base. "The ability for non-U.S. retailers to sell at drastically lower prices has significantly impacted us," the company said in court, reported Axios.

Related: Forever 21 Files For Bankruptcy: CFO Cites Competition From ‘Foreign Fast Fashion Companies’ Like Shein, Temu

Temu, operated by PDD Holdings Inc PDD, and fast-fashion giant Shein have long thrived on this duty-free model.

With the loophole dead, both giants will face a new reality: play by the rules or pay a premium for every glitter top and gadget they send stateside.

Read Next:

• Treasury Secretary Bessent Says China Holds ‘Losing Hand’ In Tariff Escalation

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