New Tariffs on Low-Cost Imports Could Bring in $10 Billion a Year

Packages at a neighborhood sorting center in Beijing, China, on Monday, April 28, 2025. Photo: Na Bian/Bloomberg

New tariffs aimed at raising revenue and blocking the flow of counterfeit goods and fentanyl into the U.S. could raise as much as $10 billion a year, U.S. trade advisor Peter Navarro told reporters Thursday.

The levies, which will apply to low-cost goods items shipped directly to consumers, are set to take effect globally on Friday. Previously, only goods from China and Hong Kong were subject to the tariffs, since the majority of so-called de minimis shipments valued at $800 or less originate from there. In the three months since their exemption was lifted, the U.S. has already brought in $492 million from China and Hong Kong, according to senior administration officials.

“The de minimis loophole was one of the dumbest things this country ever did,” Navarro added. “We’re going to save thousands of American lives by restricting the flow of narcotics.”

The new levies are already creating havoc with international shipments. Postal systems in Mexico, Japan, Taiwan, Australia, and several other countries have said they would halt such shipments at least temporarily.

For packages that do make it to the U.S., tariffs will be either the same rate imposed on the country of origin or a flat fee of $80 to $200, also depending on origin. Personal gifts valued at $100 or less will remain duty free as will $200 in personal items that U.S. travelers bring back with them.

The new levies come amid a steep increase in the number of low-value imports shipped directly to consumers. Over the past 10 years, these so-called de minimis shipments have risen from 139 million to 1.36 billion, according to U.S. Customs and Border Protection. Those tariff-free shipments were valued at an estimated $64.6 billion in 2024 and accounted for 92% of all cargo entering the country.

A rule change in 2016 that raised the value of goods exempted from tariffs from $200 to $800 helped drive the increase in shipments as online shopping took off. Retailers such as Temu and Shein along with Etsy vendors located outside the U.S. were able to capitalize on the loophole to grow sales.

Because many de minimis shipments previously came from China, the Trump administration suspended the exemption for Chinese goods back in May. The move was also intended to stop the flow of synthetic opioids into the U.S. from there.

Tariffs on imports from U.S. trade partners have already brought in more than $100 billion since they went into effect this spring. Treasury Secretary Scott Bessent has said they could raise $300 billion by the end of the year. The Congressional Budget Office estimates that they could reduce the federal deficit by $4 trillion over the next 10 years.

Write to Anita Hamilton at anita.hamilton@barrons.com