De Minimis Rule
De Minimis Rule A customs provision that allows for the duty-free and tax-free importation of shipments valued below a certain threshold. In the U.S., this threshold is $800 under Section 321.
Latest Update (March 2025)
New legislation has been introduced in Congress that would exclude certain products from China from de minimis eligibility while maintaining the $800 threshold for other countries. The bill has bipartisan support but faces opposition from e-commerce platforms.
Read about proposed legislationWhat It Means
De Minimis in Simple Terms
The de minimis rule is a customs provision that says: "If your shipment is worth less than a certain amount, you don't have to pay import duties or taxes on it." In the United States, that amount is $800 per person per day. This means small packages coming into the country—like your personal online purchases from overseas retailers—can enter duty-free as long as they're under this threshold.
This rule has become increasingly important with the growth of e-commerce, as it facilitates faster clearance for low-value shipments without the usual customs paperwork. While beneficial for consumers and small businesses, it has also raised concerns about oversight, security, and potential abuse through shipment splitting or undervaluation. Different countries have widely varying de minimis thresholds, from as low as $0 to as high as $800 in the U.S.
Historical Timeline
Initial Implementation
Early version of de minimis provisions in the Tariff Act of 1930
$200 Threshold
U.S. de minimis threshold set at $200
TFTEA Increase
Trade Facilitation and Trade Enforcement Act raised the U.S. threshold to $800
E-Commerce Explosion
Rapid growth in cross-border e-commerce leveraging de minimis provisions
Policy Debates
Increased scrutiny and policy debates about potential reform
Data Collection
CBP expanded data collection requirements for de minimis shipments
Reform Proposals
Various legislative proposals to modify de minimis provisions
Real-World Example
Case Study: E-Commerce Retailer Strategy
GloboShop is an online retailer selling consumer electronics accessories worldwide. They've developed a strategic approach to leverage de minimis provisions across multiple markets:
U.S. Market Strategy
- Established warehouses in Mexico near the border
- Individual orders up to $799 ship directly to U.S. consumers
- Utilizes simplified Section 321 entries
- Average delivery time: 3-5 days
- Duty savings passed to consumers, reducing prices by ~9%
- Return address in Mexico for easy processing
EU Market Challenges
- Lower €150 threshold limits de minimis opportunities
- Established VAT registration in key EU countries
- Uses IOSS (Import One-Stop Shop) for VAT collection
- UK operations adjusted post-Brexit for £135 threshold
- Higher operational costs due to more complex requirements
- Multiple warehouses required for timely delivery
Concrete Example: Wireless Earbuds
| Scenario | Without De Minimis | With De Minimis | Savings |
|---|---|---|---|
| Product retail price | $199.00 | $199.00 | — |
| Import duty (2.6%) | $5.17 | $0.00 | $5.17 |
| MPF/HMF fees | $3.66 | $0.00 | $3.66 |
| Formal entry costs | $10.00 | $0.00 | $10.00 |
| Clearance time | 1-3 days | 0-1 days | 1-2 days |
| Total landed cost | $217.83 | $199.00 | $18.83 (8.6%) |
Key operational considerations for GloboShop:
- Maintains strict inventory valuation control to ensure accurate declarations
- Automated systems prevent multiple shipments to the same U.S. address per day
- Pre-files data through the CBP Entry Type 86 process for faster clearance
- Maintains separate systems for EU, UK, Canada due to differing requirements
- Regular compliance audits to avoid unintentional violations
The case demonstrates how de minimis provisions can be legally leveraged to create competitive advantages in cross-border e-commerce, while highlighting the complexity of managing operations across multiple jurisdictions with different thresholds and requirements.
De Minimis Eligibility Checker
Use our interactive tool to determine if your shipment qualifies for de minimis treatment across different countries
Check Eligibility
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Schedule a ConsultationFrequently Asked Questions
In the United States, the $800 de minimis threshold is based on the "fair retail value" of the merchandise in the country of shipment, which does not include shipping costs. However, this practice varies by country. For example, in the European Union, shipping costs are included when calculating whether a shipment falls below the €150 customs duty threshold. It's crucial to understand the specific rules for each country you ship to, as including or excluding shipping costs can make the difference between qualifying for de minimis treatment or not.
While technically possible, intentionally splitting orders to circumvent customs thresholds (known as "structural splitting") is generally considered a form of customs fraud when done with the deliberate intent to evade duties and taxes. Customs authorities look for patterns that suggest abuse, such as multiple packages sent to the same address on the same day. The U.S. rule specifically limits de minimis to "one shipment per person per day." Legitimate business reasons may exist for sending multiple packages (like items shipping from different warehouses), but developing a strategy specifically to avoid duties could result in penalties, seizure of goods, and even criminal charges in severe cases.
Even if under the value threshold, certain products cannot use de minimis provisions in the U.S.: (1) Alcoholic beverages and perfume containing alcohol; (2) Tobacco products including cigarettes and cigars; (3) Products subject to antidumping or countervailing duties; (4) Products from sanctioned countries; (5) Products requiring Partner Government Agency approval without proper documentation (like FDA-regulated items). Additionally, products subject to quota restrictions, firearms, and hazardous materials typically require formal entry regardless of value. These exclusions exist for revenue protection, public safety, and regulatory compliance reasons.
E-commerce has dramatically increased the volume of shipments utilizing de minimis provisions, transforming what was once an occasional administrative convenience into a major trade channel. Before e-commerce, de minimis primarily facilitated low-value commercial samples, gifts, and emergency replacement parts. Today, millions of consumer purchases flow through this provision daily. This has led to: (1) Increased scrutiny from domestic retailers claiming unfair competition; (2) Concerns about adequate screening of high-volume small packages for safety, intellectual property violations, and contraband; (3) Challenges in collecting trade data; and (4) Debates about appropriate threshold levels. Several countries have responded by enhancing data collection requirements while maintaining the basic thresholds.
While formal entry documentation isn't required for de minimis shipments in the U.S., basic information is still needed: (1) Shipper and consignee name and address; (2) Country of origin; (3) Detailed description of the merchandise; (4) Quantity; (5) Weight; and (6) Value. Additionally, since 2023, CBP has expanded data requirements through the Type 86 entry process, requiring more detailed product information, harmonized tariff codes, and identifiers for certain shipments. Even with simplified entry, products must still comply with all applicable regulations and may require Partner Government Agency documentation. The trend is toward more information requirements while maintaining the duty and tax benefits.