The end of the de minimis exemption: Preparing for 2026 import duty changes
by February 20, 2026
For years, the de minimis exemption was a major advantage for e-commerce, allowing low-value shipments (under $800) to cross borders duty-free and expedite customs. But in 2026, the global trade landscape is undergoing a seismic shift as governments remove long-standing exemptions for low-value goods. In this blog post, we’ll uncover what is changing and how it impacts e-commerce sellers.
The global trend toward duty-heavy imports
The era of frictionless, duty-free low-value imports is rapidly ending as major global economies tighten customs controls to increase revenue.
In a dramatic shift, the US eliminated the de minimis exemption, marking a major change for importers. Low-value shipments (less than $800) that previously entered the country duty- and tax-free are now subject to customs duties, federal excise taxes, and state or local sales and use taxes—regardless of value.
In the European Union, finance ministers agreed to eliminate the €150 customs duty exemption for low-value shipments in November 2025. While the broader customs reform takes effect in 2028, the EU will pursue a temporary solution to begin levying customs duties on such goods as early as 2026.
Asia-Pacific countries are also tightening rules. Thailand abolished the customs duty exemption for low-value shipments below ฿1,500 starting January 2026, making all imported goods potentially subject to both import duty and 7% VAT upon entry. Additionally, the UK has announced plans to abolish customs duty on shipments below £135 by March 2029.
High-risk materials and regions of origin are more important than ever
Under new 2026 regulations, the price tag of an item is no longer the sole factor in determining whether it is duty-free. High-risk materials like steel, textiles, or advanced semiconductors, and specific regions of origin now trigger substantive financial obligations regardless of value. New ad valorem duties now apply to these types of imports, such as a 25% tariff on certain advanced computing chips.
Additionally, in 2025, many countries imposed new tariffs and retaliatory measures, creating cost volatility and supply chain uncertainty. This has led to increased scrutiny on certificates of origin and tariff classification.
Sellers in Europe and Asia Pacific must adapt to shifting VAT responsibilities. For example, the EU approved a directive shifting VAT responsibility for low-value imports onto sellers and platforms, instead of letting sellers pass VAT obligations to costumes. Additionally, sellers must now use the Import One Stop Shop (IOSS) system or register for VAT in each EU country, increasing compliance complexity for sellers in these regions.
What this means for e-commerce sellers
The elimination of these exemptions creates a ripple effect across your entire operation:
- Landed cost inflation: Every shipment is now subject to import duties, federal excise taxes, and local sales tax. For instance, a 40% tariff on a $15 product can slash gross margins from 56% to 42.
- Non-refundable costs: If a US customer returns an item, the duties paid are non-refundable, making free returns a high-risk strategy that directly decreases profitability.
- Operational disruption: Expect supply chain disruption, rerouted sourcing, increased paperwork, and inventory stockpiling—all of which increase lead times and carrying costs. To mitigate high tariffs, brands are pivoting to utilizing domestic warehousing to avoid duty hits.
- System requirements: Billing and ERP systems must be updated to capture origin and taxability data, automate classification, and strengthen import compliance to reduce audit risk. Every SKU in your ERP must now capture audit-ready data, including exact HTS codes, Country of Origin (COO), and detailed material descriptions.
- Customer experience: These changes create greater potential for customer friction as costs rise and documentation becomes more complex. Customers accustomed to 1–3 day domestic delivery may face 7–14 day international windows due to increased customs inspections, necessitating updated communication on delivery expectations.
The complexity of 2026 demands more than just awareness–it requires a tech stack built for global scale. Whether you are navigating new international duties or domestic state shifts, staying ahead is a competitive advantage. Stripe Tax (Stripe acquired TaxJar in 2021) provides the global infrastructure needed to manage these complex international requirements, while TaxJar continues to be the leading partner for automating your US sales tax lifecycle.
Stripe and TaxJar share a team of tax experts, including accountants and layers, that are building solutions to manage tax compliance. Together, we have created a report highlighting 2026 trends impacting global e-commerce sellers, download the report here.
