Trump wins legal battle to keep cheap imports subject to tariffs

A federal trade court ruled Thursday that President Trump can block cheap imports — including from Chinese retailers like Temu and Shein — from entering the U.S. tariff-free.

Why it matters: It's a win for the Trump administration's trade agenda after a major legal setback forced officials to find new legal avenues for imposing sweeping tariffs.

• The Court of International Trade ruling means that Trump's suspension of the so-called de minimis exemption, which allowed packages worth $800 or less to enter the U.S. tariff-free, can continue.

What they're saying: Trump took a victory lap on social media shortly after the ruling.

• "For years, Foreign Shippers could send packages worth up to $800 into our Country, DUTY FREE, NO TARIFF, far less scrutiny," Trump posted on Truth Social.
• "It became a giant loophole for TARIFF Cheats — and a Pipeline exploited by Fentanyl Traffickers, Counterfeiters, and other Criminals shipping dangerous and illegal products into America."
• The president's suspension of the exemption brought in about $1 billion in duties in 2025, U.S. Customs and Border Protection said last year.

Reality check: Congress established the de minimis exemption in 1938 to avoid the cost and burden of collecting duties on low-value shipments. Its use has exploded alongside the huge rise of e-commerce.

• Trump officials have framed the crackdown as a matter of public safety, suspending de minimis treatment for shipments from China and Hong Kong last year before expanding the policy globally a few months later.
• The Trump administration suspended the exemption under the International Emergency Economic Powers Act, the law the Supreme Court ruled earlier this year could not be used to impose tariffs.

Zoom in: That blockbuster ruling did not address whether IEEPA could be used to void the de minimis exemption, the same question at the heart of the Court of International Trade's ruling.

• In a unanimous ruling, the three-judge panel said that the text of IEEPA allows the president to cancel certain "privileges" — and the de minimis statute itself describes duty-free treatment as a "privilege," according to the opinion.

Of note: Thursday's ruling largely determines whether Trump can keep the exemption suspended until a permanent repeal takes effect next July.

• Congress eliminated the de minimis exemption in Trump's tax cut and spending bill, effective next July.

The bottom line: Ending de minimis upended the business model that helped Temu and Shein sell ultra-cheap goods to U.S. shoppers, pushing up costs and, in some cases, forcing changes to their supply chains.

• That crackdown on tariff-free cheap imports looks here to stay, and it's spreading globally, with Europe also eliminating its own exemption for cheap imported packages.