On July 4, 2025, President Trump signed the “One Big Beautiful Bill Act” into law, a sweeping legislative package that touches nearly every corner of the U.S. economy. Among its many provisions are reforms aimed at modernizing trade and strengthening customs enforcement, with a particular focus on closing the de minimis loophole and tightening import regulations.

End of the De Minimis Loophole

The de minimis exemption, introduced through Section 321 of the Tariff Act of 1930, allows low-cost goods valued at $800 or less to enter the U.S. duty- and tax-free, with minimal customs processing. Originally designed to reduce administrative burdens on Customs and Border Protection (CBP), the rule evolved into a trade facilitation tool for businesses and consumers, especially with the exponential rise of e-commerce imports.

However, the sheer volume of de minimis shipments has led to challenges with CBP’s enforcement capabilities and raised concerns about illicit goods, unfair competition, and revenue loss. Earlier this year, President Trump signed an Executive Order eliminating duty-free de minimis treatment for imports from China and Hong Kong in response to the illicit flow of synthetic opioids into the U.S. The One Big Beautiful Bill Act now repeals the de minimis exemption for all countries, effective July 1, 2027.

Key exceptions remain:

• Personal purchases made while traveling abroad
• Gifts sent from foreign individuals to U.S. residents

The bill also establishes a civil penalty for misuse of the de minimis exemption in a way that violates any other provisions of U.S. customs law, effective 30 days after enactment:

• Up to $5,000 for the first violation
• Up to $10,000 for each subsequent violation

What This Means for Businesses

Importers will now be required to file customs declarations and pay duties and taxes on all imported goods, regardless of value. With CBP audits on the rise and increased scrutiny of import compliance, importers will also need to ensure they are exercising “reasonable care” as defined by the Customs Modernization Act, including robust internal controls, regular audits, and thorough record-keeping.

How Tradewin Can Help

As the end of the de minimis exemption will undoubtedly reshape the trade landscape, Tradewin is your trusted partner in ensuring a smooth transition, with compliance being our top priority. Our global trade experts can help you stay ahead of these regulatory changes and avoid costly penalties or overpaid duties. Whether it’s accurate valuation, Country of Origin determinations, import requirements, or product classification, we tailor solutions that meet your business needs.

Tradewin is here to help. Contact us today to learn more about how we can optimize your supply chain.