Government Policy Could Change the Way You Buy Clothes Online

One of the big retail stories in the last decade has been the rise of companies like Shein and Temu. Both based in China, the retailers have found a growing following for their low-priced goods and affordable shipping, though that hasn’t come without some criticism — including a legal feud between the two companies. Their effect on the world of online shopping has had other dimensions as well, including changing the way Amazon operates.

Are we about to see another big change in online retail around these two companies? This week, the White House announced a change in policies designed to address “the de minimis exemption” in shipping. And while that term might not ring a bell, if you’ve ever ordered anything from Shein or Temu to be shipped to the U.S., odds are good that you’ve benefitted from it.

As NPR’s Alina Selyukh explained, the de minimis exception allows retailers to ship individual orders separately as opposed to part of a bundle — and if the value of that shipment is less than $800.00, the package is exempt from taxes.

The White House’s announcement explains why this is an issue. “Section 301 tariffs currently cover approximately 40% of U.S. imports, including 70% of textile and apparel imports from China,” it reads in part. The administration plans to close the loophole that currently contains this exemption, meaning that – presumably – people buying low-priced clothing on these apps would end up paying more for them.

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For their part, Temu implied that the proposed end of the de minimis exception is something that it could live with. “Temu’s growth does not depend on the de minimis policy,” a company spokesperson told NPR. Still, it’s not hard to imagine this having at least some impact on both companies, though what effect that will have on the retail landscape is unclear.