Will Americans Eat a $100 Tariff on Shein Packages?

The Trump administration’s plan to add steep fees to packages from China will deal a blow to Temu, Shein, and some TikTok Shop sellers, worrying American consumers.

Heaps of clothing packages with the word Shein on them.
A garment factory where workers make clothing for Shein in Guangzhou, China, last week.Credit…Qilai Shen for The New York Times

Tamika Johnson, a 44-year-old in Chicago, posted videos to TikTok this month about her orders from Shein, the Chinese e-commerce giant. She was nervous about potential delivery delays in the face of upcoming tariffs.

Her 213,000 followers chimed in as she shared status updates on her purchases of clothing and suitcases, detailing their own plans for last-minute orders and sharing concerns about their shipments.

“People are very worried,” Ms. Johnson, who posts to TikTok under the handle @TammyTheBlackPrepper, said in an interview. “I’m trying to stock up on clothes now and the things that I need.”

Ms. Johnson is one of many American consumers who have been posting anxiously to TikTok and Reddit about a coming Trump administration-induced change for the Chinese e-commerce companies Shein and Temu, which sell inexpensive items like $8 dresses and $14 wagons. Starting on May 2, the Trump administration is poised to end a trade loophole that enabled the delivery of ultralow-cost goods from Chinese factories straight to Americans’ doorsteps without being subject to duties. That will add steep new fees to packages from Shein and Temu.

At least some sellers on TikTok Shop, the popular app’s growing marketplace, and AliExpress, another Chinese e-commerce site, will also take a hit.

The alarm from many Americans reflects the deep inroads that the Chinese online retailers have made in the United States, siphoning consumers from dollar stores and other discount retailers with cut-rate prices and wide selections.

“So many people have brought these companies into their lives,” said Simeon Siegel, a retail analyst at BMO Capital Markets. “Companies whose main reason for being was the cheapest price — and the reason they were able to offer the cheapest price was because of shipping benefits — are going to have to dig very deep to find a way to justify their prices.”

The end of the loophole, known as the de minimis exemption, will affect packages from China, including Hong Kong, valued at or under $800. Products shipped through the U.S. Postal Service will face a tariff equivalent to 120 percent of the value of the goods, starting May 2, or a fee of $100 per package, the White House said last week. The fee, which will be collected by Customs and Border Protection, increases to $200 in June, the agency said. Items shipped from China through other carriers, like UPS, will face tariffs as high as 145 percent of the value of the goods.

A spokeswoman for Customs and Border Protection said de minimis shipments from carriers like UPS or FedEx would require importers to file with the agency and pay related duties.

It’s not clear exactly how the new duties will work. In most cases, consumers are responsible for paying the fees, but it remains hazy whether retailers will add them to the cost of items or whether customers will have to pay in order to receive their packages.

Shein and Temu posted notices to their websites this week saying consumers will face price adjustments starting on April 25 and to make purchases before then, without detailing why they chose that date. Shein declined to comment; Temu didn’t respond to a request for comment.

TikTok, in a separate notice in Mandarin to TikTok Shop sellers, emphasized the May 2 date and said it would assist with price adjustments starting on April 27 to help cover the new tariffs. TikTok did not respond to a request for comment.

President Trump has said the new fees will help fight drug smuggling, saying fentanyl and its precursor ingredients were among items sneaking into the United States through de minimis shipments. Customs and Border Protection said in a statement that it “stands ready to fully implement the restrictions on de minimis shipments and collect all revenue owed for these shipments.”

The trade of cheap packages shipped from China has exploded in the past decade. De minimis entries skyrocketed to more than one billion in 2023 from 153 million in 2015, and the biggest source of such goods is China, according to a January Congressional Research Service report. The average value of such shipments was $54 in 2023, it said.

Image

Shipping containers piled high on vessels.
The trade of cheap packages shipped from China has exploded in the past decade, with more than than one billion de minimis entries in 2023.Credit…Maggie Shannon for The New York Times

For Ms. Johnson, who works for the federal government, Shein has become her “go-to for everything,” including “pots and pans, the scale, the house rugs, large mirrors, a vacuum cleaner set,” and replacing Walmart and Amazon.

This month, Ms. Johnson said, she bought a luggage set for $60 from Shein that would have cost her $150 elsewhere. With new price increases, she said, “I would probably have to go back to the stores to see what I can afford.”

Korri Ray, a 47-year-old TikTok creator and former teacher in High Point, N.C., recently posted a TikTok video urging people to buy from sites like Shein before the tariffs kicked in. She said the pandemic had opened her eyes to the e-commerce sites.

“Before the pandemic, you ran to Target or Walmart or went to the mall to pick stuff up,” she said. “Now with a TikTok Shop or Temu or Shein, it’s been so easy to go, ‘See this? Let me order it.’”

Temu and Shein have been in the cross hairs of lawmakers in the past few years as they have expanded their presence in the United States. Politicians and industry groups have accused them of undercutting American manufacturers and importing counterfeit items. Temu has been accused of using forced labor in its supply chain, while Shein disclosed last year that it had found child labor in its supply chain. Both companies have also been criticized for fueling excessive consumption.

Both Shein and Temu are privately held, though Shein has been seeking to go public. Temu was on a pace to reach almost $20 billion in revenue this year, which is large for U.S. retail, especially given the low-priced items it is selling, said Simeon Gutman, a retail analyst at Morgan Stanley. For context, Dollar General, the biggest dollar store chain in the United States, had roughly $40 billion in sales last year.

Image

Credit…via TikTok

Shein and Temu have each run scores of digital ads in the United States and, in Temu’s case, even Super Bowl commercials to attract consumers. Industry analysts say a decline in their sales may hit the U.S. ad industry.

Sydney Perna, a 27-year-old TikTok creator and political commentator in Portland, Ore., said that she bought items like gem stickers for nails from Temu because they were as cheap as $1 per pack, and that she enjoyed doing her friends’ nails at home during difficult economic times. Items like that will become cost-prohibitive under the new tariffs, she said, adding that “our most sensitive populations can’t afford this kind of price hike.”

Leave a Comment

Your email address will not be published. Required fields are marked *

*
*