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Trump’s Tariff Changes Impact Low-Income Households
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By Ava Thompson | WASHINGTON, D.C. – 2025/09/07 11:12:14
Changes to import regulations are poised to raise the cost of goods for low-income families,following the end of a tariff exemption.
Previously, the de minimis rule allowed imports valued at $800 or less to enter the country without tariffs or administrative fees. This provision had become a significant pathway for foreign online retailers to send inexpensive goods into the U.S. without incurring additional costs.
President Donald Trump initially targeted this practice earlier this year by ending the de minimis exemption for goods coming from China in May. More recently,the exemption was eliminated for all countries.
Now, imports will be subject to the tariffs imposed by the TRUMP administration on many of the U.S.’s trading partners.
Impact on Consumers
Reports indicate that prices at online retailers like Shein and Temu increased after the initial change affecting Chinese imports. A similar trend is expected for goods from other countries, potentially impacting low-income households the most.
“Lower-income households have already taken the brunt of the U.S. labor market slowdown.”
According to the National Bureau of Economic Research, approximately 1 billion shipments, representing 7.3% of all U.S. consumer goods imports, were covered by the de minimis exemption in 2023. These shipments were primarily destined for lower-income households,making them particularly vulnerable to price increases resulting from the tariff changes.
Data shows that nearly 75% of direct shipments to consumers in the lowest-income zip codes were de minimis imports, compared to just 52% of shipments to the highest-income zip codes.
Economic Context
Lower-income households have already faced challenges due to a slowdown in the labor market, including reduced wages and fewer working hours. The situation could be further exacerbated by the phasing out of federal government assistance programs from the “One Big, Beautiful Bill”.
Frequently asked Questions
what is the de minimis rule?
The de minimis rule allows goods valued below a certain threshold to be imported without tariffs or taxes,simplifying customs procedures.
Who is most affected by the change in tariff exemptions?
Lower-income households are disproportionately affected, as they tend to purchase more goods that previously qualified for the de minimis exemption.
Why was the de minimis exemption eliminated?
The exemption was eliminated to address concerns about unfair trade practices and to level the playing field for domestic businesses.
