Prices soared by 100%, and some brands have stopped shipping

On May 2 local time, the United States terminated its tax exemption policy for small parcels in China. Affected by it, retailers in many countries have adjusted or suspended their business in the United States, e-commerce platforms have reorganized their logistics systems, some products have doubled their prices and delayed delivery, and foreign brands have stopped shipping American goods, and some small and medium-sized enterprises have withdrawn from the US market.

All small packages worth no more than 0 will be subject to tariffs, which puts ordinary Americans who are accustomed to online shopping facing considerable difficulties. Now after they click "order", what they are waiting for is no longer just express delivery, but the rising amount in the shopping cart and the slower logistics notifications.

According to the Wall Street Journal on May 2, the change has a huge impact, as about 1.36 billion parcels entered the United States in this way in fiscal year 2024 alone, most of which came from Chinese cross-border e-commerce platforms. Reuters said the move forced some e-commerce platforms to restructure their logistics systems, increase commodity prices, and accelerate the construction of local warehouses in the United States to avoid the direct impact of high tariffs. At the same time, some foreign brands have stopped shipping to the United States, while some small and medium-sized enterprises have even chosen to withdraw from the U.S. market. According to Bloomberg, the prices of some products on some e-commerce platforms have increased by more than double, and users generally complain about delays in delivery on social platforms.

Some local American companies are also making adjustments. The Wall Street Journal disclosed that a US footwear brand transferred its inventory from Canada to a local U.S. warehouse because a pair of Chinese-made sneakers that were originally sold for 5 will now bear taxes and fees if shipped through Canada. Not only companies, but consumers are also feeling the pressure. Because they have seen a significant price increase, and experts also pointed out that the impact of this policy on low-income families is particularly obvious because they rely more on lower-priced cross-border e-commerce products, such as clothing, daily necessities and small electronic devices.

In an interview with local media, Packard, a researcher at the Cato Institute, pointed out that this policy is ostensibly tough on China, but is actually raising taxes on American consumers. He pointed out: "This means higher prices and slower logistics, and consumers are paying for this policy."

The policy could cost businesses and consumers a total of up to billion a year, with the first victims being low-income groups. At the same time, this policy will also put serious pressure on the US customs system, which may lead to delays in customs clearance. An estimate from the Oxford Economic Research Institute believes that if the U.S. government wants to impose tariffs on all small parcels one by one, it will need to add at least a billion dollars in budget to expand the system and increase manpower, otherwise it will face the risk of a nationwide backlog of ports.

On May 2 local time, the American Footwear Distributors and Retailers Association sent a letter to the White House this week, requesting exemptions from what President Trump calls “reciprocal tariffs”, saying that these tariffs pose an "existential threat" to the footwear industry.

It is reported that the letter was signed by 76 footwear brands, including Nike, Adidas, Skecher and Under Armour. The letter said many companies that produce affordable footwear cannot afford such high tariffs and cannot pass on these costs. If the reciprocal tariffs are not lifted immediately, these companies will have to go bankrupt. Many orders have been put on hold and U.S. consumers’ footwear inventory may soon be inadequate, the association said.

On May 1 local time, the U.S. Chamber of Commerce announced that it had written to the U.S. government, requiring the government to impose tariff exemptions for small American businesses to prevent the U.S. economy from falling into recession. Clark, president and CEO of the U.S. Chamber of Commerce, said that over time, small businesses face increasingly threats of high costs and supply chain disruptions that could suffer irreparable injuries.

In response to the issue of small American businesses requiring tariff exemptions, Stephen Miller, deputy director of the White House Office, gave a negative response at a press conference that day, but said small businesses would receive tax cuts.