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A tax loophole allowed Americans to buy lots of cheap stuff from China. Not anymore

JUANA SUMMERS, HOST:

A lot of Americans turn to online Chinese platforms like Temu and Shein searching for deals, but starting tomorrow, consumers will need to pay import duties on these orders. The Trump administration says the move is to counter fentanyl trafficking. NPR's Emily Feng explains.

EMILY FENG, BYLINE: This week, Amanda Norris remembered she'd meant to order new pet harnesses to her home in Florida.

AMANDA NORRIS: Like, oh, I'll get my dogs new harnesses and then forgot to order them.

FENG: So she checked her basket on Temu - that's a Chinese e-commerce platform - and she discovered...

NORRIS: The total for the two dog harnesses came to, like, $33, but then the import charges for an additional $46 and change. So it brought the whole total for the two dog harnesses up to 80-something dollars.

FENG: Eighty dollars, more than double the original price. Surprised consumers like her have been posting screenshots of their import duty quotes on social media in the days before these duties started. Norris says she's going to look elsewhere for her shopping now.

NORRIS: I tend to thrift almost everything.

FENG: There's been pressure to end what's called the de minimis exemption since the Biden administration. This exemption meant small packages could enter the U.S. for free if they were valued under $800 - great for the consumer if you're ordering, say, hot pants from Chinese e-commerce site Shein or 50 sponges from Temu, but not so great for the U.S. government, which misses out on tax revenue, or American companies who can't compete with these low, low prices. And there's this...

(SOUNDBITE OF ARCHIVED RECORDING)

UNIDENTIFIED PERSON: While most shipments carry legitimate goods, many contain fake or dangerous products that can put American consumers and businesses at serious risk.

FENG: This is a new video this week from U.S. Customs and Border Protection - or CBP - which has to screen the more than 1 billion of these small packages that arrive at U.S. ports every year.

LAURA MURPHY: Often, what CBP is faced with is a single package in that shipment that they suspect might have some illicit content in it.

FENG: This is Laura Murphy. She's a former Department of Homeland Security adviser, now at the Center for Strategic and International Studies. She points out, with the new customs duties, importers now need to fill out information about where every small package is coming from and what's in them. It's a lot more work, including for U.S. Customs officials, but...

MURPHY: They're going to have so much more information in their system that will help them figure out which container has the illicit packages.

FENG: Chinese shopping apps like Temu are now promoting what they call local goods - items already in warehouses in the U.S., so no import duties. But those goods will run out at some point.

Emily Feng, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Emily Feng
Emily Feng is NPR's Beijing correspondent.

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