China’s ultra cheap clothes could become more expensive President Trump’s new ratesand help Amazon erase the competition from abroad.
On Tuesday, the same day, President Donald Trump, the same day, Donald Trump, an additional 10% tariff over all Chinese products came into force. agreed to pause Tariffs against Mexico and Canada for 30 days.
In addition to imposing a 10% tax on Chinese imports, Mr. Trump’s executive order also suspended a little known customs exemption that allowed minimis value goods, articles worth less than $ 800, to reach the free of US taxes. The order throws a key in the business models of China Retainers in China such as Shein and Temu, who were previously exempt from tariffs and customs inspections thanks to De Minimis Loophole.
It is also likely that the change of rules will result in delivery delays since the packages now have to go through customs, he told Associated Press, founder of Juozas Kaziukenas, founder of the market of the intelligence firm of electronic commerce.
Neither Shein nor Temu responded to requests for comments on how the new rules would affect their businesses.
Minimis exemption helped Chinese electronic commerce giants maintain their low costs and attracts predominantly young US consumers with contemporary styles at incredibly low prices. Companies send directly to consumers, which allows them to compete with national players, including Amazon, who launched their own response to Temu and Shein last year, called Amazon Haul. Strictly available in the Amazon application, Amazon Haul presents products sent from China that cost less than $ 10 and sell items that resemble those sold by Shein and Temu.
How much can prices increase?
Now that Shein and Temu are in the hook of the existing duties that once overlooked, in addition to the new 10% rate imposed by Mr. Trump, and potentially taxes collected by the customs authorities, those aggregate costs could be transmitted to Consumers.
While price increases could be insignificant, some buyers can be deactivated by delays in shipping brought by inspections of forced customers of packages.
“If the tariffs stay, we could see higher prices in electronics, clothing and other things,” Moneywatch Ryan Young, a senior economist of competitive Competitive Enterprise Institute, a defense group that defends less regulation, to CBS Moneywatch, told CBS. “There will be frustrating delays, and this will be frustrated in Temu, Shein and other business models of low -cost suppliers.”
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