Update: On February 7, 2025, President Trump signed an executive order that temporarily delays the cancellation of the de minimus exemption.

Activists have decried Shein for years, calling out its devastating impact on the environment and exploitation of workers. But with a stroke of his pen, President Donald Trump appears to have upended Shein’s business model, making it harder for the Chinese fast-fashion brand to keep selling clothes at rock-bottom prices.

During the pandemic, Shein and online marketplace Temu exploded in popularity in the United States. Both companies manufacture low-quality goods in Chinese factories using cheap labor, then sell them to American consumers at extremely low prices. But Shein and Temu also had a distinct advantage over their competition. While American companies like Gap ship large quantities of inventory from overseas factories into U.S. warehouses—paying all the requisite taxes and tariffs—these Chinese companies ship products directly from factories to consumers’ houses. This allows them to take advantage of an obscure loophole in the U.S. tax code called de minimis, which allows packages containing less than $800 of merchandise to ship duty-free.

In 2022, Shein and Temu paid $0 in import taxes, whereas Gap paid $700 million and H&M paid $205 million. American and European brands pass their costs on to customers in the form of higher-priced goods, which has sent many shoppers looking for deals elsewhere. “This was their basic advantage,” says........

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