Senators Ron Wyden (D-Or.) and John Thune (R – S.D.) recently introduced the Low Value Shipment Regulatory Modernization Act of 2013, which would raise the de minimis value from $200 to $800. The de minimis is the threshold at which shipments coming into the United States are exempt from tariffs, taxes or customs procedures.
“If you bring back goods from abroad, you’re allowed up to $800 [worth as tax free],” says Eugene Laney, vice-president of international trade affairs for DHL Express. “But for commercial products, it’s only $200.”
By raising the de minimis level, Laney says that the government’s workload will be reduced and simplified – a benefit that he says is increasingly valuable due to the spending cuts caused by sequestration.
Laney also says an increase to $800 will help domestic manufacturers, as they will be able to import goods and materials more quickly.
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More than two dozen trade and transportation groups wrote to Senate Finance Committee leaders Aug. 31 asking for their support for drafting a bill that would increase the de minimis level for low value shipments for the first time in nearly 20 years.
The groups told Chairman Max Baucus and Ranking Member Orrin Hatch that raising from $200 to $1,000 the aggregate retail value of articles that may be imported without entry documentation or payment of duties by one person on one day would “simplify and streamline the customs entry process and offer significant benefits for both trade and the government.”
Raising the de minimis amount “is not a security issue,” the trade groups asserted, but instead is “an issue of efficiency, job creation and economic stimulus.” The letter explained that all shipments are subject to the same security threat analysis and CBP risk assessment processes prior to arrival, regardless of whether they fall under the de minimis level or not, and that simplified entry and release of low value shipments could actually improve security by allowing CBP to focus its resources on larger and higher risk commercial shipments where enforcement is better justified.
The letter added that the entry reforms would pose no increased risk of commercial violations because they would only apply to smaller and lower value shipments and that any decreases in government revenue that might be incurred would be “easily offset” by the savings associated with reallocating CBP resources from entry document processing and review to security, targeting and trade facilitation.
Finally, the letter said, the proposed changes would reduce costs for customers and small businesses and encourage more companies to engage in international trade, which “would generate more business opportunities and economic growth.”
Source: STR Trade Report