State of Affairs: No Tariffs for US Customers
Hello!
Last week we delayed our highly anticipated Starfall restock while we waited for US trade volatility to settle down.
The good news is, it has, but we won’t know for how long.
Definitions
Customs - the government department that collects duties (taxes) on imported goods
Customs fees or charges - government taxes and fees incurred by customs authorities
De minimis - lacking significance or importance
De minimis exemption - imports valued under $800 are not subject to customs
Importer - the person or entity importing goods into a country; most often, you, the customer for e-commerce orders
Tariffs - taxes levied by a government to punish foreign trade
A quick recap
Tariffs and customs fees have been in place for US customers as long as taxes have existed but the de minimis exemption made it so customs did not process shipments valued under $800.
When Trump cancelled the de minimis exemption last week, it subjected all foreign shipments to taxes they were previously exempt from. The border was backed up due to the lack of staff, infrastructure, and reliable systems required to process the massive change in the volume of eligible shipments.
Trucks were turned away at the border, packages were stuck in customs limbo; it was generally detrimental to international trade but specifically impacted the e-commerce industry.
Read our original blog.
How have things changed?
Trump repealed the cancellation of the de minimis exemption, which means business is as usual until he reinstates it.
Trump said he’d be cancelling the de minimis exemption until the border was equipped to handle the changes in legislation. A systemic change like this is typically executed over months, not days as he attempted last week.
To put this into perspective, Canada changed its import process to require all importers to have an account through their new program, CARM, which went live on October 21st. There are still no expectations of importers to use it because there are onboarding challenges that have yet to be worked out.
All in all, expecting an immediate change with no hiccups was silly at best. Trump accepted that it needed more time and repealed the de minimis cancellation to give the system time to adapt. Hopefully, we’ll be warned or given a date on which the de minimis exemption will be officially cancelled so we have time to adapt.
What does this mean for your order?
Non-US customers have nothing to worry about, yippee!
As of right now, any US customer ordering from Carmico will receive their package as usual. There won’t be processing times at the border, there won’t be customs fees to pay for, you’ll track your package and it will arrive at your door, simple as that*.
*A very big asterisk: Trump already has a track record of forcing the system under short timelines. If he makes a change to the de minimis exemption while your order is still in Canada, your order will be affected by customs charges.
A reminder about tariffs
Now more than ever we see many people on social media claiming that carriers are holding their packages “hostage”. If your imported packages are ever held by customs with a balance to be paid, this is because your government is requiring you, the importer, to pay taxes on the imported goods. That’s it. Some people get the wrong idea that it’s the carrier or the seller asking for extra money but it is simply your government taxing your import.
This tax is used to deter foreign trade and encourage domestic trade. Any international company you purchase from, Carmico included, has nothing to do with these fees. We don’t get a single cent of customs charges and it increases the cost to our customers.
Economic fundamentals say when the cost goes up, demand goes down. These changes to trade will severely affect us since the majority of Carmico’s market is in the US. The extent of which is unknown but it’s bad for Carmico, period.
Bottom line
Everything is as usual, the only exception is for US customers to be mindful that if Trump turns on a dime and cancels de minimis before your package has crossed the border, you could be required to pay customs fees on your order.
So order quickly! This may be the last time you can order from Carmico without customs fees.
Happy shopping!
The CarmiCrew
