Summary: In a significant shift in trade policy, President Donald Trump has announced reduced tariffs on small parcels imported from China and Hong Kong. This new measure, along with the temporary reduction of tariffs between the US and China, aims to ease trade tensions. Key details include a cut in tariffs from 120% to 54% on parcels valued under $800, providing temporary relief to consumers and online retailers alike.
Trump Reduces Tariffs on Small Imports from China
President Donald Trump has officially slashed the tariff on small parcels sent from mainland China and Hong Kong to the US. This announcement comes just hours after the two largest economies in the world agreed to cut tariffs on each other’s goods for a 90-day period.
Tariff Changes: What You Need to Know
The new tariffs on small packages valued up to $800 (£606) have been reduced from an imposing 120% to a more manageable 54%, according to a White House statement. Additionally, a flat shipping fee of $100 will remain in effect for items sent after May 2, while a previously planned $200 charge starting June 1 has been rescinded.
The Impact on Online Retail Giants
Chinese e-commerce platforms like Shein and Temu have heavily relied on the “de minimis” exemption to ship low-cost items directly to US consumers without incurring duties or import taxes. However, this exemption was curtailed by the Trump administration earlier this month, prompting buyers to expedite their purchases ahead of the deadline.
Joint Statement from the U.S. and China
The latest tariffs come on the heels of a joint statement released by the US and China, confirming their commitment to temporarily lower tariffs and engage in new trade negotiations. Following this news, share markets surged, as optimism surrounding a major trade dispute eased.
What’s Next for U.S.-China Trade Relations?
Under the newly agreed terms, US tariffs will drop from 145% to 30%, while China will reduce its retaliatory tariffs on US goods from 125% to 10%. President Trump indicated that while some levies have been suspended, they may be reinstated in three months if no substantial progress is made. “We’re not looking to hurt China,” he said, adding that he expects to have a conversation with Chinese President Xi Jinping soon.
Frequently Asked Questions
Q: How will these new tariff cuts affect shoppers?
A: The reduced tariffs will lower costs for small parcels shipped from China, allowing consumers to purchase low-value items more affordably.
Q: What does the term “de minimis” mean in this context?
A: “De minimis” refers to the exemptions that allow low-cost imports to enter the US without incurring duties or taxes, which benefited Chinese retailers significantly.
Q: Will tariffs rise again in the future?
A: Yes, if trade progress does not continue over the next three months, tariffs previously in place may be reinstated.