On July 1, 2025, the U.S. Senate approved a provision to permanently eliminate the de minimis exemption as part of a Budget Reconciliation Bill. This legislative move is now awaiting approval from the House of Representatives before it can be sent to President Donald Trump for his signature before the July 4th holiday.
The National Council of Textile Organizations (NCTO) welcomed the Senate’s decision to end de minimis for commercial shipments from all countries. NCTO President and CEO Kim Glas expressed gratitude to Senate leaders for including this crucial provision. “On behalf of the U.S. textile industry, I commend Senate leaders for including an important provision in the broader budget reconciliation bill that would permanently end de minimis for commercial shipments from all countries, effective July 2027,” Glas stated.
The de minimis rule, also known as Section 321, allows goods valued at $800 or less to enter the U.S. duty-free without a formal customs declaration, streamlining e-commerce and minor international trade transactions. However, this has presented challenges for Customs and Border Protection, particularly in screening packages that may contain illegal substances such as fentanyl precursors and counterfeit goods.
In response to these issues, bipartisan legislation known as “The Closing the De Minimis Loophole Act” was introduced by Senators Sheldon Whitehouse (D-R.I.) and Lindsey Graham (R-S.C.) in May. This proposed law aims to remove de minimis exemptions for Chinese imports immediately and gradually for all other countries over four months, while also tasking the Treasury Secretary with overseeing necessary rulemaking processes.
Glas highlighted the importance of this legislative effort, stating, “We sincerely appreciate Senators Lindsey Graham and Sheldon Whitehouse for leading efforts on a legislative solution that would codify and permanently end duty-free de minimis treatment for millions of low-value packages from China and all countries.”
This significant legislative change aims to promote a fairer environment for domestic textile manufacturers, especially as the industry has faced challenges, including the shutdown of 28 facilities in the past two years.
