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| Economy | |
| Trump shuts major tax loophole in devastating blow to online shoppers as tariffs have Wall Street bracing for stock market rout | |
| 2025-04-03 | |
The president spent Wednesday unveiling his sweeping tariff plan, delivering a fiery speech accusing other nations of taking advantage of the US. Now, a jittery Wall Street is bracing for chaos Thursday morning as US stock markets open for the first time since Trump unveiled the higher-than-expected tariffs. Initially overshadowed by the broader tariff announcement, an executive order that closes what's known as the 'de minimis' loophole, a century-old trade law that allows imports valued under $800 to enter the US duty-free — provided they are shipped directly to individual buyers. Shutting down this exception could be the death knell for companies like Shein and Temu, which rely on direct shipments from China and Hong kong that allowed them to bypass US import fees with the loophole. Under the new rules, imports valued at $800 or less will now face either a 30 percent duty or a $25 per-item fee, with that rate set to double to $50 per item after June 1.. The impact will be huge. US Customs and Border Protection processes over one billion de minimis shipments per year, with Shein and Temu alone accounting for nearly 600,000 packages daily. More than 90 percent of all packages coming into the US now enter via de minimis —making this one of the biggest shakeups to online shopping in years. Trump explained in the order that ending the exception is meant as a way to 'combat China's role in America's synthetic opioid crisis.' The president initially got rid of the loophole in early February before making a quick U-turn after shoppers had complained they were already feeling the pain of his new rules. However, the delay was only so the Commerce Department can confirm procedures are in place to process them and collect tariff revenue. Chinese companies had been increasingly taking advantage of this rule, prior to Trump getting rid of it. Chinese exports of low-value packages jumped to $66 billion in 2023, up from $5.3 billion in 2018. The re-closing of the loophole means prices will rise for Americans who buy $5 shirts, $10 lamps and $20 shoes on direct-from-China shopping sites. Retail experts say that regular US retailers like Walmart and Amazon, who ship items from domestic warehouses, face a disadvantage compared to their rivals who ship items directly from China and avoid various import fees. It comes as Wall Street holds its breath ahead of the markets opening for the first day after the tariffs were announced. Markets are expected to open sharply lower, wiping trillions of dollars off the value of US stocks — a blow that will also hit ordinary Americans whose retirement savings are tied to the market. | |
| Posted by:Skidmark |
| #2 Temu probably hurt more than Amazon |
| Posted by: Lord Garth 2025-04-03 18:10 |
| #1 Jeff Bezos hardest hit. |
| Posted by: ed in texas 2025-04-03 14:03 |