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Hola Richardson! Thanks for this week's edition. It is brilliant. May I ask you a question about the removal of duty free imports from China for USA based consumers?
According to a user named @revdrone on Reddit, the removal of duty free trade for goods parcels valued at $800 or less will impact consumers the following way.
"...For packages coming in, regardless of the package value, you will now need to pay import duties, appropriate tariffs based on the product and country of origin, and then you will also have to pay the brokerage fee which goes to a company that handles the duty and customs process which is determined by the shipping company which I have heard is around 50$ per package.
Regardless of the country of import, I believe that we are looking at a substantial cost to bring stuff from overseas. I suspect a order around 100$ will cost more like 200$.
Additionally US customs will now need to process MILLIONS of more packages over night. The system is going to completely jam up and unless the administration reverses course, I wouldn’t be surprised if it takes 3+ months to get through customs."
It sounds grim and a lot like all the bullshit we now go through here in the UK thanks to end of frictionless trade with EU based exporters. Has this Redditer more or less got this right?
Thanks for the clarification Richardson. I’m researching the issue for an Answerman piece. I don’t believe 10% tariffs is terrible news for consumers as it may be swallowed in the short term by distributors, but the impact this end to duty free importing from China could have on Japanese collectible’s is another matter entirely.
Yes, I agree there are two different angles here: one for traditional imports by distributors and a second for individual imports through low-value e-commerce purchases. Looking forward to your piece!
Hi Jerome! I think some of the numbers the Redditor mentions are a little inflated, but the general understanding is correct. Suspending the de minimis exemption not only subjects a product to import duty, but also any potential tariffs applicable to the product and any fees charged by the shipping carrier. That triple whammy is what will drive up cost for consumers.
However, the Redditor's comments about customs processing times are exaggerated and misleading. U.S. customs already inspects all packages, regardless if they have a de minimis exemption or not. Suspension of de minimis doesn't mean customs is processing more packages than before. Shippers are required to submit a document that establishes the customs product code and country of origin of the goods, even for packages under US$800 in value.
What we need to watch is at what point those duties are collected from consumers. If they're collected by the seller in advance as part of shipping fees, that will significantly make the customs process easier. If sellers and shippers rely on U.S. customs to charge those duties directly to consumers, that's what will slow down processing.
Great article, and very informative. Thanks Richardson!
In Cover's case in particular, they are expanding in the US itself, so I guess they will eventually ship to a warehouse there and offer from a localised store... but this will definitely affect others (FuRyu -although also expanding in the US-, Kotobukiya...).
I wonder how this affects second hand products, as they are fairly common in proxy sales. Do you happen to know?
Duties and tariffs also apply to secondhand products and new products, sometimes at different rates. We see this today on clothing imports, where many countries apply a higher tariff on used clothes than on new clothes.
I use Japanese proxy buying services myself. There are usually two types of services. One type is the use of a proxy agent to purchase, receive, and ship the product. In this scenario, the proxy agent will usually identify the product code that needs to be reported to customs for duty calculations on behalf of the customer. The second type is having the proxy agent only receive and ship, while the customer makes the purchase themselves. In this scenario, the customer is required to report to the proxy agent the product code, which is then reported to customs.
Hola Richardson! Thanks for this week's edition. It is brilliant. May I ask you a question about the removal of duty free imports from China for USA based consumers?
According to a user named @revdrone on Reddit, the removal of duty free trade for goods parcels valued at $800 or less will impact consumers the following way.
"...For packages coming in, regardless of the package value, you will now need to pay import duties, appropriate tariffs based on the product and country of origin, and then you will also have to pay the brokerage fee which goes to a company that handles the duty and customs process which is determined by the shipping company which I have heard is around 50$ per package.
Regardless of the country of import, I believe that we are looking at a substantial cost to bring stuff from overseas. I suspect a order around 100$ will cost more like 200$.
Additionally US customs will now need to process MILLIONS of more packages over night. The system is going to completely jam up and unless the administration reverses course, I wouldn’t be surprised if it takes 3+ months to get through customs."
It sounds grim and a lot like all the bullshit we now go through here in the UK thanks to end of frictionless trade with EU based exporters. Has this Redditer more or less got this right?
Thanks for the clarification Richardson. I’m researching the issue for an Answerman piece. I don’t believe 10% tariffs is terrible news for consumers as it may be swallowed in the short term by distributors, but the impact this end to duty free importing from China could have on Japanese collectible’s is another matter entirely.
Yes, I agree there are two different angles here: one for traditional imports by distributors and a second for individual imports through low-value e-commerce purchases. Looking forward to your piece!
Hi Jerome! I think some of the numbers the Redditor mentions are a little inflated, but the general understanding is correct. Suspending the de minimis exemption not only subjects a product to import duty, but also any potential tariffs applicable to the product and any fees charged by the shipping carrier. That triple whammy is what will drive up cost for consumers.
However, the Redditor's comments about customs processing times are exaggerated and misleading. U.S. customs already inspects all packages, regardless if they have a de minimis exemption or not. Suspension of de minimis doesn't mean customs is processing more packages than before. Shippers are required to submit a document that establishes the customs product code and country of origin of the goods, even for packages under US$800 in value.
What we need to watch is at what point those duties are collected from consumers. If they're collected by the seller in advance as part of shipping fees, that will significantly make the customs process easier. If sellers and shippers rely on U.S. customs to charge those duties directly to consumers, that's what will slow down processing.
Great article, and very informative. Thanks Richardson!
In Cover's case in particular, they are expanding in the US itself, so I guess they will eventually ship to a warehouse there and offer from a localised store... but this will definitely affect others (FuRyu -although also expanding in the US-, Kotobukiya...).
I wonder how this affects second hand products, as they are fairly common in proxy sales. Do you happen to know?
Duties and tariffs also apply to secondhand products and new products, sometimes at different rates. We see this today on clothing imports, where many countries apply a higher tariff on used clothes than on new clothes.
I use Japanese proxy buying services myself. There are usually two types of services. One type is the use of a proxy agent to purchase, receive, and ship the product. In this scenario, the proxy agent will usually identify the product code that needs to be reported to customs for duty calculations on behalf of the customer. The second type is having the proxy agent only receive and ship, while the customer makes the purchase themselves. In this scenario, the customer is required to report to the proxy agent the product code, which is then reported to customs.