The US has cancelled the tax-free treatment for imported packages under $800: What impact will it have?

On July 30 local time, US President Trump signed an executive order to suspend duty-free treatment for imported parcels valued at $800 or less starting from August 29. All applicable tariffs must be paid for small parcels. This policy adjustment is like a huge rock thrown into the lake of the international economy, stirring up thousands of waves and exerting profound and multi-faceted impacts on the economic landscape of the United States and the world at large.

The small duty-free system in the United States can be traced back to the 1930s. Initially, it was designed to simplify cross-border trade procedures, facilitate passengers to carry souvenirs back home, and reduce the burden on customs departments. In 2016, the United States raised the tax-free threshold from $200 to $800. This move directly gave rise to the "direct mail + tax-free" cross-border e-commerce model represented by Shein and Temu, causing the import volume of small parcels in the United States to soar tenfold from 2015 to 2023. In recent years, some voices within the United States have held that this policy has been abused and has become one of the reasons for the inflow of illegal goods and the impact on domestic manufacturing. In addition, geopolitical factors and the rise of trade protectionism have also prompted the US government to adjust this policy.

From the perspective of the domestic economy of the United States, the impact of policy adjustments is multi-faceted. At the consumer level, American consumers, especially those with low incomes, will directly face the pressure of rising living costs. In the past, people relied on cross-border e-commerce to purchase low-priced goods such as clothes, daily necessities and small electronic devices. Now, due to the increase in tariffs, prices have risen sharply. According to the estimation of the US Consumer Research Institute, this policy may cause a combined annual loss of up to 47 billion US dollars for businesses and consumers, with low-income families being the first to be affected. Cross-border goods that were originally affordable have become expensive. Consumers may have to reduce their purchase volume or turn to more expensive domestic products. This undoubtedly lowers the quality of life and consumption experience of consumers.

At the enterprise level, cross-border e-commerce merchants and platforms that rely on the direct mail model of small parcels have suffered a heavy blow. The operating costs of platforms such as Temu and Shein have increased significantly, and their profit margins have been severely compressed. Some small and medium-sized enterprises may even choose to withdraw from the US market due to their inability to bear the cost pressure. Although domestic enterprises in the United States may benefit from reduced competition in the short term, in the long run, due to the adjustment of supply chains and the decline in market vitality, they will also find it difficult to remain unscathed. In addition, the US customs system will be under tremendous pressure. The original daily customs clearance volume of about 4 million small packages has now dropped significantly due to the need for individual taxation. Customs may have to invest a large amount of funds and manpower to deal with this situation; otherwise, it will face the risk of severe backlog at ports.

Looking at the global economic landscape, the impact of this policy is equally significant. In terms of international trade, this policy has disrupted the normal international trade order and hindered the healthy development of cross-border e-commerce, this emerging trade model. The orders of export enterprises from various countries to the United States have decreased, and the global trade volume may decline accordingly. Postal operators and logistics enterprises in many countries have successively announced the suspension of parcel services to the United States, such as the postal services of many European countries and DHL. This has seriously disrupted the global logistics system and increased the uncertainty and risks of international trade.

In the field of digital economy, this policy has dealt a blow to digital trade capabilities and data-driven operation models. The United States precisely distinguishes the tax collection methods between "private logistics networks" and "international postal systems", aiming to crack down on e-commerce orders sent directly through channels such as DHL, UPS, and FedEx, weaken the competitiveness of other countries in the digital cross-border field, and affect the cooperation and development of the global digital economy.

The United States' cancellation of duty-free treatment for imported packages priced under 800 US dollars is another manifestation of its trade protectionism. Although it may achieve some political or economic goals in the short term, in the long run, it not only harms the interests of American consumers and enterprises, but also brings many negative effects to the global economy, undermining the favorable situation of international economic cooperation and win-win. In the future, the international community needs to make joint efforts. Seek more reasonable and fair solutions.