What to know about Trump's ‘de minimis' changes

Earlier this month, President Donald Trump closed a long-standing loophole that had allowed a flood of inexpensive Chinese goods to be mailed to the United States without any tariffs.

- MEAGHAN TOBIN AGNES CHANG

Starting May 2, those packages faced a tariff of 120% or a $100 flat fee.

After the United States and China agreed this week to a temporary truce in trade tensions, that tariff is now 54%. The changes, which took effect Wednesday, were described in a White House executive order and guidance from Customs and Border Protection.

For the past decade, a tax loophole known as the de minimis exemption allowed goods worth up to $800 to enter the United States without import duties. The result was millions of packages shipped from China to the United States, as American shoppers got hooked on buying everything from flash drives to water bottles at low prices.

Chinese companies such as Shein and Temu built their businesses around the loophole, sending goods made in Chinese factories directly to American shoppers. At the same time, China pushed its manufacturers to find buyers overseas.