Tangshan, in northern China’s Hebei province, in 2012.”>WASHINGTON D.C. – A recent suspension of the de minimis rule by the Trump administration is triggering a wave of economic repercussions, impacting retailers and consumers alike, and contributing to a slowdown in economic growth.The change, enacted last week, eliminates tariff exemptions for imports valued at $800 or less, a policy previously designed to streamline trade.
The de minimis provision, initially established in 1997 at a $200 threshold and raised to $800 in 2016, allowed for the duty-free entry of low-value shipments. This facilitated e-commerce and reduced costs for both businesses and consumers. The Biden administration maintained the $800 threshold until the recent reversal. The reinstatement of tariffs on these shipments is expected to increase costs for retailers, who are likely to pass those expenses onto consumers, effectively acting as a broad-based tax increase.Analysis by the Trade Partnership indicates that the average American household coudl see an increase of $200-$300 annually due to these tariffs.
The policy shift echoes concerns voiced during the 2024 presidential campaign by Vice President Kamala Harris, who characterized former President trump’s tariff proposals as a “sales tax on the American people.” Harris specifically highlighted the disproportionate impact on middle- and lower-income families.
A growing number of companies are now citing tariffs as a contributing factor to their financial distress. Bloomberg Law reported a 23% increase in bankruptcy filings in the first half of 2025 compared to the same period last year, with tariffs frequently mentioned in court documents.
Home decor retailer At Home, based in Plano, Texas, filed for Chapter 11 bankruptcy protection in June 2025, explicitly citing the impact of tariffs. CEO Brad Weston stated in a press release that the company was “operating against the backdrop of an increasingly dynamic and rapidly evolving trade habitat as we navigate the impact of tariffs.” The company reported $1.8 billion in sales in fiscal year 2023 and employs approximately 13,000 people.
recent employment data released by the Bureau of Labour Statistics on August 1st,2025,shows a slowdown in job creation,with 175,000 jobs added in July – significantly lower than the average of 262,000 jobs added per month in the preceding six months. While multiple factors contribute to employment trends, economists at the Peterson Institute for International Economics attribute a portion of the slowdown to the increased costs associated with tariffs. Despite this data, former President Trump has publicly dismissed the figures, alleging manipulation and promoting unsubstantiated claims of a stronger economy, as reported by the Daily Kos.
Retailers,including accessories chain Claire’s,are facing increased pressure. Industry analysts predict further consolidation and potential bankruptcies within the retail sector if the tariff policy remains in effect. The National Retail Federation has publicly urged the administration to reconsider the policy, arguing it will harm consumers and stifle economic growth.
