US Proposes New Taxes on Chinese Shipments to Curb Influx from Online Retailers Shein and Temu

The US has proposed rules that would hit many low-value shipments from China with new taxes – a measure aimed at curbing the flood of packages from shopping sites such as Shein and Temu.

The Biden administration said the plan was intended to stop “abuse” of an exemption that allowed packages worth less than $800 (£600) to enter the US without facing tariffs and other fees.

The US said the “de minimis” rule has helped firms such as Shein and Temu, which typically ship directly from the manufacturer to the customer, undercut competitors with lower prices.

In statements, the two companies defended their business models.

The US raised the exemption from tariffs and other fees for shipments from $200 to $800 in 2016 to facilitate trade and allow officials to focus on higher priority shipments.

But lawmakers have voiced increasing alarm about “exploitation” by firms such as Temu and Shein, as the two make rapid inroads in the US market.

The new rules would remove the exemption for Chinese goods that currently face tariffs from the US – a wide range of products including shoes, machinery and 70% of textiles and apparel.

They would also increase what information shippers must provide to authorities.

Temu said its success was due to an “efficient business model that cuts out unnecessary middlemen, allowing us to pass savings directly to our consumers”.

It said it was reviewing the rules and remained committed to “delivering value to consumers”.

“Temu’s growth does not depend on the de minimis policy,” it added.

Shein said its success came from its “on-demand business model” and that it supported reform of the de minimis exemption so that the rules were applied “evenly and equally”.

The company said compliance was a priority and that it was already participating in a trial programme with US Customs and Border Protection (CBP).

“We want to disclose more of what’s in every package and are working closely with CBP,” the company said.

Since launching a few years ago, Temu and Shein have gained followers with flashy Super Bowl adverts and ultra-low prices.

The popularity has put such pressure on Amazon, the dominant e-commerce company in the US, that the firm is reportedly exploring its own discount unit focusing on direct-to-consumer shipments.

Their rise has also brought scrutiny from US politicians and regulators, who have raised questions about the safety of products on their sites and warned of a “high risk” that Temu was selling products made using forced labour.