De Minimis is Dead – Tariff Loophole Loses in Court
After experiencing setbacks to his tariff agenda in court, President Trump was excited to announce last week that the Court of International Trade (CIT) upheld his striking down of the de minimis exemption that allowed foreign shippers to send packages valued at up to $800 into the U.S. duty-free:
BIG WIN today at the U.S. Court of International Trade on one of the most DESPICABLE loopholes in American Trade Policy — The so-called “de minimis” exemption.
For years, Foreign Shippers could send packages worth up to $800 into our Country, DUTY FREE, NO TARIFF, far less scrutiny. It became a giant loophole for TARIFF Cheats — and a Pipeline exploited by Fentanyl Traffickers, Counterfeiters, and other Criminals shipping dangerous and illegal products into America. The numbers were staggering. In 2024 alone, de minimis cost America an estimated 10.8 BILLION DOLLRS in foregone TARIFF Revenue, and an astonishing share of narcotics and counterfeit seizures came through the de minimis channel. So, we CLOSED IT. With the stroke of my mighty pen — NO AUTOPEN!!! — we ended this ridiculous giveaway, and made Foreign Goods play by the rules. The Importers sued. Today, THEY LOST. The Court ruled that the President had the Legal Authority to rescind this so-called “privilege.”
America is now SAFER, our Workers are better protected, and BILLIONS in TARIFF Revenue that used to slip through this loophole can instead help pay for our Great Military, Tax Relief, NO TAX ON TIPS, and NO TAX ON SOCIAL SECURITY. AMERICA FIRST TRADE — AND AMERICA FIRST LAW ENFORCEMENT! President DONALD J. TRUMP
Many importers who dislike the president’s tariff hikes in general actually do like his striking down of the de minimis tariff loophole. It gave their foreign competitors a competitive advantage. Famously, it allowed companies like Temu to sell cheap goods into the U.S. market without having to charge steep shipping fees.
The non-partisan Coalition for a Prosperous America (CPA) applauded the CIT for upholding President Trump’s striking down of the de minimis exemption.
The CPA has long fought against the de minimis exemption, so it’s no surprise they applauded the court rejecting the legal challenge some importers brought to reopen the tariff loophole that President Trump had closed. The CPA said the de minimis exemption served “as a pipeline for counterfeits and fentanyl precursors while law-abiding American businesses paid full freight.”
How De Minimis Is Fully Dead
Interestingly, it was actually the International Emergency Economic Powers Act (IEEPA) – which the Supreme Court ruled did not give President Trump sufficient authority for his original, sweeping reciprocal tariffs – that the court ruled did give the president the power to strike down the de minimis exemption.
Zach Schonfeld reported in the Hill that an auto-parts distributor, Detroit Axle, latched onto the Supreme Court’s ruling that struck down President Trump’s IEEPA-authorized tariffs in challenging his striking down of the de minimis exemption. But in this case:
… the trade court ruled IEEPA’s language — which authorizes the president to “nullify” or “void” any “privilege” with respect to foreign-owned property — means he can still end exemptions.
“The power to rescind the exercising of a ‘privilege,’ applied here to an exemption Congress has explicitly described as a ‘privilege,’ does not equate to the authority to impose unbounded and unlimited tariffs,” the court wrote.
Thus, the de minimis exemption is dead. This was a last chance moment to bring it back, as beyond the president striking it down, Congress passed the One Big Beautiful Bill Act – which eliminates the exemption in 2027 – and U.S. Customs and Border Protection (CPB) made a regulation to indefinitely suspend the exemption in the meantime. As the CPA put it:
With this ruling, every branch of government is now aligned: the loophole is closed by executive action, closed by regulation, closed by statute — and now upheld in court.
De Minimis Strike Down Worth Billions in Revenue for the Federal Government
There is a significant amount of revenue for the federal government that was previously lost to the de minimis exemption. About half a year after President Trump struck down the exemption, the CBP reported it collected over $1 billion because of the action:
U.S. Customs and Border Protection collected over $1 billion in duties on over 246 million low-cost shipments since the administration began phasing out the de minimis loophole in May 2025, recovering a record amount of revenue that had previously gone uncollected.
“Reaching the $1 billion milestone so quickly shows just how much revenue was slipping away under the old rules,” said CBP Commissioner Rodney S. Scott. “With this change, American businesses don’t have to compete with duty-free foreign goods, and CBP has stronger oversight of what comes into our country.”
The CBP reported that on December 17th, 2025. The president struck down the exemption on May 2nd, 2025.
