For decades, shipments under $800 entered the US duty-free. That's over. Here's exactly what you pay in 2026 — and how to adapt — with a free calculator to run your own numbers.
For most of the last decade, US importers had a quiet advantage: any shipment valued at $800 or less could enter the country duty-free, with minimal paperwork. This was the de minimis rule — formally Section 321 of the Tariff Act of 1930 — and it powered an entire generation of dropshippers, fast-fashion brands, and small importers buying direct from China.
That advantage is gone.
The one thing every source agrees on: shipments from China and Hong Kong no longer qualify for duty-free entry, full stop. The picture for other origins has been subject to ongoing rule-making and legal challenges, so the safest assumption for any importer in 2026 is simple — do not count on duty-free treatment for any commercial shipment from China, and verify the current rule for other origins with your customs broker before you ship.
Before the change, an estimated 1.4 billion shipments per year entered the US duty-free from China and Hong Kong alone. If your business model assumed those parcels were duty-free — and you priced your products accordingly — your margins have been quietly bleeding since May 2025.
With de minimis gone, a shipment from China faces the full stack of US duties. For most consumer goods, that means:
Combined, a typical consumer product from China now carries roughly 35% in duties — and that's before customs broker fees and processing costs.
Remember that the US calculates duties on the FOB value (the product cost at the Chinese port), not the CIF value. Freight and insurance are excluded from the dutiable base. This is the opposite of the EU and UK, which use CIF. So your 35% applies to the product cost, not the full delivered cost.
Let's take a concrete case — a small e-commerce seller importing a single $50 consumer product (say, a bluetooth speaker) direct from China. Before May 2025, this would have entered duty-free under de minimis. Here's what it costs now:
| Cost component | Amount (USD) |
|---|---|
| Product value (FOB) | $50,00 |
| Standard duty (~3% for electronics) | $1,50 |
| Section 301 tariff (25%) | $12,50 |
| Section 122 surcharge (10%) | $5,00 |
| Customs processing / broker (per parcel) | $8,00 |
| Total added cost | $27,00 |
| Effective cost increase | +54% |
A product that cost you $50 landed now costs around $77 — a 54% increase on what used to be a duty-free import. If your retail price was calibrated to compete with US-based sellers at the old cost, that increase comes straight out of your margin. This is why so many pure dropshippers exited the market in 2025–2026.
There's a second route for low-value parcels that catches people off guard. For shipments sent through the international postal system (rather than commercial couriers), carriers can choose to apply a flat per-item postal duty instead of the standard ad valorem rate.
This flat fee has been as high as $200 per item. Carriers generally pick whichever option is cheaper — but the maths can be brutal for low-value goods:
| Item value | Flat $200 fee equals | vs. ~35% ad valorem |
|---|---|---|
| $50 item | 400% | $17,50 |
| $200 item | 100% | $70,00 |
| $700 item | ~29% | $245,00 |
The lesson: the flat postal fee is catastrophic for cheap items and only makes sense for higher-value goods. For most small importers, this is another reason the per-parcel direct-from-China model no longer works.
If you import into Europe, this isn't just a US story. The EU is eliminating its own low-value import exemption — the €150 customs duty threshold — starting in July 2026.
This mirrors the US change. Low-value shipments that previously entered the EU without customs duty will now face full duty treatment. Combined with the EU's existing import VAT (already charged on all imports since the 2021 reforms), this means small shipments into the EU face both duty and VAT.
The duty-free threshold is disappearing on both sides of the Atlantic in 2026. US importers lost it in 2025; EU importers lose it in July 2026. There is no longer a "small enough to ignore" shipment size — every cross-border order needs to be costed with full duties built in.
The end of de minimis is an operational problem, not a death sentence. Sellers who have adapted successfully use one or more of these three strategies:
Instead of shipping many small parcels direct to consumers, ship inventory in bulk to a US warehouse (Amazon FBA, a 3PL, or your own) and fulfil domestically. You pay duty once on the full shipment instead of per parcel — eliminating the per-parcel entry overhead. This is the standard FBA model, and it's now the most cost-efficient route. Delivery times to customers also drop to 1–3 days.
Vietnam, India, Mexico and Malaysia still face duties, but a lower overall stack — no Section 301, no Section 122 in some cases. Some brands have moved production there. Be careful: customs authorities actively enforce "substantial transformation" rules to prevent simply re-routing Chinese goods through a third country.
The least pleasant option, but sometimes necessary. If your product can't easily move to bulk import or alternate sourcing, you may need to raise prices to absorb the new duty stack. The brands that delayed repricing through 2025 lost 15–30 points of margin on every unsold-at-old-price order.
Most successful sellers run a combination — bulk import for steady SKUs, alternate sourcing for de-risked categories, and selective repricing where needed.
De minimis was a US customs rule (Section 321 of the Tariff Act) that allowed shipments valued at $800 or less to enter the country duty-free, with minimal paperwork. It was eliminated for China and Hong Kong on 2 May 2025 — this is unambiguous and remains in force. A broader elimination followed on 29 August 2025, though its application to non-China origins has been subject to ongoing rule-making. The safest assumption in 2026: do not count on duty-free treatment for any commercial shipment from China, and verify the current rule for other origins with a customs broker before shipping.
A typical consumer product from China now faces approximately 35% in combined duties — 10% Section 122 surcharge plus 25% Section 301 tariff, applied to the FOB value. On a $50 item, that is roughly $17.50 in duties. For postal shipments, carriers may instead apply a flat per-item postal duty (up to $200 per item), but they generally choose whichever option results in the lower charge. On top of the duty, formal entry adds $4–$25 per parcel in broker and processing fees.
No. The Supreme Court ruling in February 2026 struck down the IEEPA reciprocal tariffs, but the de minimis elimination was authorised through separate executive action. It was not reversed and remains firmly in effect in 2026, with no legal challenges pending. Importers should not expect the $800 duty-free threshold to return.
Yes. The EU is eliminating its own low-value import exemption (the €150 customs duty threshold) starting in July 2026. This mirrors the US change and means EU importers and e-commerce sellers will face customs duties on low-value shipments that were previously exempt. If you import into both the US and EU, both markets now require full customs treatment on small shipments.
There are three viable strategies: (1) Bulk import to a US warehouse and fulfil domestically — you pay duty once on the full shipment instead of per parcel, which is the standard FBA model and now the most cost-efficient; (2) Shift sourcing to non-China origins like Vietnam, India or Mexico, which still face duties but a lower overall stack; (3) Reprice to absorb the new duty costs. Most successful sellers combine bulk importing for steady SKUs with selective repricing.
With no more duty-free threshold, knowing your true landed cost per unit matters more than ever. Use the free Import Cost Calculator to model duties, freight, VAT and fees for your product and destination — US, EU, UK and 50+ countries.
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Tariff rates and customs rules change frequently. This article reflects rules in force as of June 2026. The Section 122 surcharge is set to expire 24 July 2026 unless extended. Always verify current rates with a licensed customs broker before placing orders.