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?? With the new changes to the De Minimus exemption taking effect soon, how will these changes affect US ecommerce? ?? Danny Parisi from Glossy has the latest story on this significant change to US import policy. ?? The policy change: The Biden administration plans to tighten U.S. import rules, targeting a loophole that allows companies like Shein and Temu to import goods tax-free under the de minimis exemption, which currently waives duties for shipments under $800. This exemption has driven imports from 140 million to over a billion annually in the past decade. The proposed executive order would restrict this exemption, particularly affecting low-cost textiles from China. While the move aims to protect U.S. businesses and curb counterfeit goods, critics warn it could raise consumer prices, increase compliance burdens, and complicate trade for smaller e-commerce companies. The change have a positive side effect by protecting brands that pay duty for high-value goods and shield them from businesses undercutting on price alone. ?? “There has been a tidal wave in de minimis shipments that have been driven by Chinese online retail giants such as Shein and Temu,” said Margaret A. Kidd, CMILT, CPE?, program director of supply chain and logistics at the University of Houston. “The current volumes have led to unintended negative consequences, such as making drug trafficking easier, a proliferation of counterfeit goods, a movement of low-quality and unsafe goods, and missed tax duties.” Some side effects, however, might not be a positive for US consumers. ?? “Ending the de minimis exemption could have a range of unintended side effects,” said Ash Jamshidpour, founder and CEO of ShipTop. “For consumers, this policy change could mean higher prices for goods that were previously more affordable. For smaller e-commerce businesses and international businesses using similar strategies, it might create additional barriers to market entry.” Additionally, for all of the anti-China rhetoric from US politicians, it's of the utmost importance that US consumers and businesses aren't caught in the crossfire. ?? “Ending the exemption may also increase customs processing times and add compliance costs for all businesses,” Robert Khachatryan, founder & CEO of Freight Right Global Logistics. “While aimed at large players, smaller e-commerce sellers relying on cross-border sales may struggle with the added paperwork and potential delays.” https://lnkd.in/eYNWSh2w

“The Biden administration proposal to bar overseas shipments of products that are subject to U.S.-China tariffs from being eligible for the de minimis exemption threshold levels the playing field for American Companies. Duties are in place to protect the US economy in general and US jobs and national security in particular. There has been a tidal wave in de minimis shipments that have been driven by Chinese online retail giants such as SHEIN and Temu. The current volumes have led to unintended negative consequences such as making drug trafficking easier, proliferation of counterfeit goods, movement of low quality and unsafe goods and missed tax duties. Unfortunately, many of these de minimis shipments have intentionally circumvented US customs inspections and taxes.” Tariffs and bolstering U.S. trade’s competitiveness against China is one of the few areas where Republicans and Democrats tend to share similar strategies. Thank you Danny Parisi, Glossy for including my thoughts in your article today along with Robert Khacahtryan, Freight Right Global Logistics, and Ash Jamshidpour, ShipTop. Want to stay ahead of the curve on your trade compliance and not get caught short? The Supply Chain & Logistics Technology - University of Houston program is a proud partner of the National Customs Brokers & Forwarders Association of America, Inc. (NCBFAA). Consider registering today to be certified via University of Houston and NCBFAA. Get certified:https://lnkd.in/gH6JEGfh UH Cullen College of Engineering SIDO at UH Gap Tailored Brands, Inc. ISM Houston ASCM Houston Chapter The TJX Companies, Inc. Macy's Ross Stores, Inc. Kohl's Nordstrom DICK'S Sporting Goods Wayfair Burlington Stores, Inc. JCPenney Dillard's Inc. lululemon Academy Sports + Outdoors Victoria’s Secret & Co. Nieman Marcus American Eagle Outfitters Inc. Foot Locker #globaltrade #retail #tariffs #supplychain #logistics #trade #tradecompliance

South Africa's textile and apparel industry is facing potential changes to duties on imported products, according to Dr Mark Goodger, CEO of Maritime Legal Solutions and Chartered Tax Adviser from the South African Institute of Taxation. Starting next month, low-value and small-volume clothing orders from Chinese companies Shein and Temu will be subject to higher taxes. The South African Revenue Service (SARS) has committed to taxing all clothing parcels with an import duty of 45% plus VAT from 1 July 2024. This move comes after local clothing retailers accused Chinese companies of exploiting a tax loophole that kept their import prices low. Read more:https://lnkd.in/dRdYHkbh This article was published by the Daily Investor.

South Africa's textile and apparel industry is facing potential changes to duties on imported products, according to Dr Mark Goodger, CEO of Maritime Legal Solutions and Chartered Tax Adviser from the South African Institute of Taxation. Starting next month, low-value and small-volume clothing orders from Chinese companies Shein and Temu will be subject to higher taxes. The South African Revenue Service (SARS) has committed to taxing all clothing parcels with an import duty of 45% plus VAT from 1 July 2024. This move comes after local clothing retailers accused Chinese companies of exploiting a tax loophole that kept their import prices low. Read more:https://lnkd.in/d4Fmmbg6 This article was published by the Daily Investor.

TEMU & SHEIN ARE DODGING TAXES IN SOUTH AFRICA LINK: https://lnkd.in/dHSEjSwD South African retailers have been for a long time now been concerned that your girlfriend’s fav “clear my cart” stores Shein and Temu are exploiting tax loopholes in SA in order to sell their products at prices that local shops cannot compete with. A recent court judgement In South Africa, will see #Shein and #Temu pay standard import taxes on goods and parcels under R500, compared to before when they could get clothing parcels of this size through customs with only a 20% import duty and 0% VAT. So When does this start… Well From 1 July 2024, all clothing parcels will be subject to an import duty of 45% plus VAT. Buying clothes from these online retailers is going to be more expensive. The move by SARS is an attempt to “level the playing field” for local retailers following criticism that Chinese firms Shein and Temu are “abusing” tax loopholes to gain an unfair advantage in the local market by allegedly breaking up large shipments into “small packages”. With the now proposed increase there is likely to be about a 39% price increase on sub-R500 orders. So how will this translate into the prices of what you buy? An official with one of the trade unions further claimed Shein pays as little as 10%–20% on import tariffs compared to standard tariff charges of 40%–45%. In the complaint, the unions allege that the company deliberately sends goods to its customers in small packages to accrue less import duty. To illustrate the impact of the change, consider the example of an R100 clothing order from Shein or Temu. Previously, this order would only attract an additional R20 in tax and no VAT. Following the change, getting the same item through customs will require paying a R45 import duty and R21.75 in VAT. The total price of the order will now be R166.75 instead of R120, a 39% increase. Actually tell us in the comments if you’ve ever bought from these retailers, what was your experience like, what made you buy there, was it the selection of items, prices or something else? Whatever the future holds for SA’s e-retail sector the Chinese are going to be a major players. Tell us how this makes you feel

South Africa is taking a stand against tax evasion by imposing significant customs tax hikes on Temu and Shein clothing orders. This move aims to create a fairer competitive environment for local retailers, who have been struggling against the unfair advantage these global giants gained by evading import duties and VAT. As South Africa sets this precedent, other countries may follow suit, ensuring that e-commerce giants play by the rules everywhere. This could mark the beginning of a more equitable global retail landscape. ?? Walter Holbrook #Retail #Ecommerce #TaxCompliance #FairCompetition #GlobalTrade https://lnkd.in/dSr45v4i

New Tax Measures on Temu and Shein Imports to Level the Playing Field for South African Retailers Starting 1st September, the South African Revenue Service (SARS) will implement new tax measures on imports from popular online retailers Temu and Shein. This move aims to address the long-standing concerns of local e-commerce players and clothing sector unions who have been advocating for fairer competition. Currently, parcels valued under R500 are taxed at 20% without VAT, while those over R500 face a 45% import duty. The new regulations will impose both VAT (15%) and a 20% import tax on small parcels as an interim measure, with final duties expected to be announced in November. Local retailers like Takealot have struggled to compete with the low-cost imports from these offshore giants. The “de minimis rule” has allowed Temu and Shein to split larger orders into smaller packages to benefit from lower import duties. This practice has been criticized for giving foreign businesses an unfair advantage over domestic manufacturers. SARS Commissioner Edward Kieswetter has highlighted the significant tax losses due to these loopholes, estimated at around R3.5 billion. The new measures are part of SARS’s commitment to creating a predictable and fair trading environment for all businesses. As the e-commerce landscape continues to evolve, these changes are a crucial step towards ensuring a level playing field for South African retailers and protecting local jobs.

???????? ?????? ?????????? ???????????????? ???? ?????????????? ???????????? ???? ?????? ???? ?????? ???????????? Germany has supported the elimination of EU import tax exemptions that benefit Chinese retailers such as Shein and Temu. The German Finance Ministry has welcomed the European Commission's proposals to adapt European customs law to the challenges of eCommerce, pointing to a broader reform plan that includes the elimination of duty-free allowances. These exemptions allow parcels under €150 to avoid customs duties, allowing eCommerce players like Temu and Shein to offer lower prices compared to their European counterparts. Removing these tax breaks would increase costs and potentially reduce their competitive advantage. Stricter customs enforcement will further challenge their operations, as both companies rely on fast, low-cost logistics. This reform is part of a broader EU effort to ensure compliance with labor and production standards, targeting the market strategies of these Chinese retailers. The timing is critical for Shein, which is preparing to go public. Increased costs and regulatory scrutiny could affect its market valuation and expansion plans. Temu, which is also expanding aggressively in Europe, will face similar challenges in maintaining its price advantage. These changes reflect the EU's commitment to protecting local businesses and ensuring fair competition. The broader implications for Shein and Temu underscore the growing regulatory pressure on global eCommerce giants operating in the EU market. Sources: Reuter, Euronews

1–It’s about time…..Must be an election year…..we need the statement to become ACTION?? #CPA Statement On #BidenAdministration Action To Prohibit Certain Imports From Using #DeMinimis Loophole WASHINGTON — The Coalition for a Prosperous America (CPA) today welcomed the Biden administration’s announcement that it will seek to prohibit goods subject to Section 201, 232, and 301 tariffs from entering the U.S. via the de minimis loophole. The administration’s move is a significant step forward in curbing the flow of unfairly traded goods, particularly from China, which exploits this loophole to flood the U.S. market with imports. However, CPA strongly urges the administration to take further action and close the de minimis loophole entirely. CPA has been one of the leading voices in calling for closing the de minimis loophole, which allows unidentifiable foreign vendors to ship millions of packages per day into the U.S. without facing taxes, fees, or legal accountability. As a result, this cripples domestic manufacturers and workers, undermines retailers, and strains law enforcement resources. It also kills thousands of people who are poisoned by fentanyl each year—the leading cause of death for people ages 18-49. “We commend the Biden administration for taking initial steps towards closing the de minimis loophole, which China and transnational criminal organizations have weaponized against America,” said Michael Stumo, CEO of CPA. “Approximately 26,000 Customs officials handle 110,000 regular import shipments per day in which the importers or their brokers are known, are accountable, are subject to inspection, pay the required tariffs and fees, and provide full information of what is in the shipment. But the de minimis loophole makes a mockery of this process by allowing high volume trade anarchy with 4 million packages per day, sent by unknown and undiscoverable vendors, which the U.S. Postal Service then delivers to customers, or criminals, all across America. President Biden’s action will thankfully reduce the de minimis shipment volume, but not enough. Imports should be allowed only by identifiable persons with accountability to our laws, who present the goods for inspection and the payment of duties and fees.” The de minimis loophole has created an avenue for Chinese firms and other foreign entities to evade tariffs designed to protect U.S. industries, while overwhelming U.S. customs and law enforcement agencies. In May, CPA and members of the Coalition to Close the De Minimis Loophole sent a letter to House Ways and Means Committee Chairman Jason Smith (R-MO) and Ranking Member Richard Neal (D-MA) highlighting how the de minimis loophole contributes to illicit fentanyl trafficking and fatalities. The de minimis loophole also undermines the Uyghur Forced Labor Prevention Act (UFLPA) by allowing goods produced with forced labor to enter the U.S. undetected. Earlier this year, Department of Homeland Security Secretary Alejandro Mayorkas Cont’d……

The White House is cracking down on cheap Chinese imports from Temu and SHEIN. How? By forcing them to pay more taxes... Here’s what went down: The Biden Administration is looking to make significant changes to the 321 program. In its current form, it allows international goods under $800 to be exempt from import taxes. Brands like Temu and SHEIN have long used this loophole to avoid paying import tariffs thanks to their direct-to-consumer shipping model. Instead of sending large shipments of goods in bulk to US warehouses where fulfilment is done state-side, these eCom giants instead ship individual orders directly to the homes of American shoppers, bypassing import tariffs and saving themselves millions. The Biden Administration wants to stop this. They say the scale of products using this loophole “undercuts American workers, retailers and manufacturers” and makes it difficult for government officials to ensure these goods are legal, safe and inline with consumer-protection laws. According to the White House: Direct-to-consumer shipments have exploded to since 2012 where 140 million packages were shipped using this loophole. Last year, that number stood at more than 1 billion. → with Temu and Shein accounting for much of this increase. Spokesmen for both companies have come out in support of these proposed reforms, claiming that they don’t rely on this loophole to make their business model work. It's likely though that any increases in shipping cost will have to be footed by the consumer - potentially removing one of their biggest USPs. The law was originally put in place to protect small businesses and individual shippers - many of whom have spoken out against the proposed changes. But so far, no official timeline has been given as to when these amendments will come into effect. And you have to wonder: Who's this going to hurt more? →The likes of Temu and Shein? or →The small, independent eCom suppliers hoping to tap into the US consumer market? Interested in seeing your takes.