President Donald Trump on April 8 imposed an initial tariff on packages valued under $800 at 30% of the shipment value or $25, effective May 2.
Shein’s headquarters are located in Singapore. Photo: Bloomberg
However, the new tax rate will be 90% of the value of the shipment or $75 and will increase to $150 after June 1.
Previously, shipments worth less than $800, known as “de minimis,” were imported into the US without being subject to duties, according to CNBC.
This duty-free category has been a huge boon for major Chinese online retailers like Shein and Temu, which ship goods directly to US customers via international mail.
Also on April 8, Mr. Donald Trump announced that the US will soon announce large tariffs on pharmaceuticals.
According to the president, these tariffs will cause pharmaceutical companies to “leave China” and other manufacturing centers, and “rush back to America.”
Donald Trump has previously floated the idea of tariffs of 25% or more on imported pharmaceuticals. It is unclear how pharmaceutical companies would respond to tariffs, including whether they would drive up prices for generic drugs.
Researchers from the University of Toronto and the University of Pittsburgh say $3 billion worth of pharmaceuticals sold in the U.S. depend on Canadian manufacturing, and tariffs on drugs could add $750 million to costs.
Expanding tariffs to other exporting countries like China, India and Europe could exacerbate the impact, including pushing up health care costs and disrupting drug supplies.
Diederik Stadig, a healthcare analyst at ING, estimates that tariffs on all pharmaceutical imports into the US would add $0.12 to each low-cost generic pill. More expensive drugs such as those used to treat cancer could cost as much as $10,000.
Indian pharmaceutical manufacturers are unlikely to move production to the US because manufacturing costs in India are much cheaper, Stadig said. However, if Indian companies decide to move production, building new facilities would take about 10 years.
