[Text/Watchman Network Chen Sijia] According to a May 2 report by Reuters, as the United States canceled its policy of tax exemption for small parcels of Chinese goods on May 2, some retailers have stopped selling products to US customers or begun looking for temporary solutions to mitigate the impact of Trump's tariff policies. Trade experts said that the US decision to impose a 145% tariff on enterprises and consumers is untenable.

On February 1, US President Trump signed an executive order canceling the "de minimis" tariff exemption for parcels "valued at less than $800" entering the US starting from February 4. However, the Trump administration withdrew this policy a few days later, announcing the restoration of the exemption for small parcels from China until "sufficient systems are in place to fully and swiftly process and collect tariff revenues."

But on April 2, Trump signed another executive order, announcing that the termination of the "de minimis" tariff exemption for small parcels from China would take effect from the Eastern Time of May 2.

Reuters reported that the US administration's decision has disrupted global trade, forcing many retailers to stop selling products to US customers or seek temporary solutions to mitigate the impact of tariffs.

In a notice on April 30, British beauty product retailer Space NK stated that the company had suspended accepting e-commerce orders from the US and shipping to the US "to avoid incorrect or additional charges being levied on our customers' orders." Canadian-based underwear seller Understance also said it would stop shipping to the US due to the impact of tariffs.

Cindy Allen, CEO of global trade advisory firm Trade Force Multiplier, said: "For companies and customers, a tariff increase from zero to 145% is untenable. I see many small and medium-sized enterprises choosing to completely exit the market."

April 25, Port of Los Angeles, California, Visual China

The report pointed out that the mode of transportation may affect the import costs of goods entering the US. For goods handled by the US Postal Service, the tariff is 120% of their value or $100 per parcel. According to guidance documents released by the US Customs and Border Protection, this amount will increase to $200 in June.

Retailers willing to continue entering the US market must raise the prices of their products. Mike Branney, managing director of UK clothing retailer Oh Polly, revealed that compared to other markets, the company has raised prices in the US market by 20%. He said that due to the higher tariff rates in the US, prices may be further increased.

The report noted that Chinese cross-border e-commerce platform Temu has marked products available in its US warehouses on its website and added a "local" label. The platform also informed US users that imported goods from local warehouses will not incur import fees. In a statement, Temu said: "All sales in the US are now handled by local sellers and completed domestically."

Platform Shein posted on social media to reassure US customers. The platform stated: "The prices of some products may differ from before, but most of our products remain affordable as always." Shein's clothing is mainly produced in China, with the US being its largest market.

However, Reuters noted that imports prior to May 2 will eventually run out, and Temu and Shein have cut digital advertising spending in the US over the past few weeks in preparation for potential changes that could affect their sales.

In the absence of the "de minimis" tariff exemption for small parcels, sellers dealing with Chinese-made goods must provide more detailed information to US Customs regarding the manufacturing origin of each component of their products. The increase in administrative burdens and the huge cost of tariffs are discouraging small retailers.

Carol Tome, CEO of UPS, said on April 29 that many of the courier company's smaller clients purchase goods that are "100% made in China."

Regarding the US move to cancel the tariff exemption policy for small parcels, China's Ministry of Commerce responded on April 17, stating that this move would seriously affect the interests of US consumers.

Spokesperson He Yongqian said that cross-border e-commerce has unique advantages such as high efficiency, fast delivery, and low costs, better meeting consumers' personalized and diversified needs. It represents an important trend in the innovative development of international trade and has become an indispensable lifestyle for people. He emphasized that cross-border e-commerce is a new form of trade that meets global consumption trends and benefits hundreds of millions of consumers. Relevant policy adjustments should be oriented toward facilitation. We are willing to work with all countries to strengthen exchanges and cooperation and jointly promote the healthy and sustainable development of cross-border e-commerce.

This article is an exclusive piece by Watchman Network and cannot be reprinted without permission.

Original source: https://www.toutiao.com/article/7499847706953826851/

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