President Donald Trump has significantly reduced tariffs on Chinese imports as the United States enters a 90-day period of trade negotiations with China, according to a May 12 executive order.
What Happened: The order decreases the de minimis tariff rate on low-value Chinese imports from 120% to 54%, effective May 14.
Additionally, the planned increase of the per-postal-item duty from $100 to $200, originally scheduled for June 1, has been suspended. The executive order also lowers general Chinese import tariffs to 10% by suspending 24% from the previously imposed rate for the 90-day negotiation period.
Trump justified these reductions by stating that China has taken “significant steps to remedy non-reciprocal trade arrangements” by entering discussions with the United States to address “the lack of trade reciprocity in our economic relationship and our resulting national and economic security concerns.”
Why It Matters: The tariff adjustments represent a significant shift in Trump’s trade strategy that previously targeted Chinese e-commerce platforms like Temu owned by PDD Holdings Inc – ADR PDD and Shein, after closing the de minimis exemption that had allowed goods valued under $800 to enter the United States duty-free.
The earlier crackdown had substantial ripple effects across digital advertising markets, with Sensor Tower reporting that Temu reduced its average daily U.S. advertising spend by 31% between March and mid-April.
Marketing firm Tinuiti noted that Temu, which represented 19% of all U.S. Google Shopping ads, saw its share drop to zero just one week later.
Image Via Shutterstock
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