Industry Debates De Minimis Threshold in Trade
The U.S. Chamber of Commerce and the National Foreign Trade Council (NFTC) are engaged in a debate over the de minimis threshold in trade. This threshold allows goods with a value below $800 to enter the United States without any duty charges. The concern arises from Congress, which believes that the provision enables the flow of fentanyl into the country and allows China to avoid paying high duties on their shipments.
However, the business groups are pushing back, stating that there is no evidence to support the claim that the de minimis threshold leads to an increase in counterfeit goods or the influx of fentanyl through low-value shipments. On average, the duty savings on a de minimis shipment amount to only $2 to $4 per shipment. This amount is considerably lower than the cost Customs and Border Protection (CBP) would incur to process the shipment if it were subject to tariffs.
The U.S. Chamber of Commerce and the NFTC argue that instead of focusing on de minimis reform, attention should be directed towards strengthening CBP’s ability to enforce crucial trade laws across all entry channels. By addressing this issue, they believe that concerns related to counterfeit goods and the influx of dangerous substances can be better addressed.
The outcome of this debate remains uncertain. It is unclear whether the House will pass a de minimis reform bill this year or if it will be left unresolved.
In conclusion, the de minimis threshold in trade is under scrutiny, with the U.S. Chamber of Commerce and the NFTC challenging the need for reform. While Congress is concerned about the potential risks associated with this provision, the business groups argue that there is insufficient evidence to support these concerns. The focus should instead be on strengthening CBP’s ability to enforce trade laws across all entry channels. The final decision on de minimis reform is yet to be determined.
Source: https://www.politico.com/newsletters/weekly-trade/2023/11/06/industry-shields-up-for-de-minimis-threshold-00125471
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