A Retailer’s Guide to the New U.S. Tariffs on Goods Made in China and Hong Kong

As of May 14 2025, new U.S. import tariffs have significantly altered the cost of shipping products made in China and Hong Kong, particularly for ecommerce businesses selling into the U.S.

In this guide, we’ll walk you through:

• What’s Changed with U.S. Tariffs (May 2025 Update)
• How This Affects International Shipping
• What You Can Do to Minimise the Impact

🚨 What’s Changed with U.S. Tariffs (April-May 2025 Update)

If your business exports products made in China or Hong Kong, especially to the U.S., it’s crucial to understand the latest changes affecting both small parcels and larger commercial shipments.

As part of a 90-day pause in the U.S.–China trade war, both countries have agreed to ease tariff tensions while negotiations continue. One of the most significant changes:

• U.S. tariffs on general imports of goods manufactured in China and Hong Kong have been reduced from 145% to 30%.

This temporary relief could open up more cost-effective export opportunities for Australian retailers targeting the U.S. market.

How This Affects International Shipping

The new tariff structure and De Minimis suspension will have a major impact on Australian businesses that send products manufactured in China and Hong Kong to the U.S., regardless of where they are shipped from. Here’s what you need to know:

1. Higher Costs for Products Manufactured in China and Hong Kong

These new tariffs mean that businesses importing products that were manufactured in China or Hong Kong — regardless of where they are shipped from, even if they are sent from Australia — will face increased costs. This will affect retailers, manufacturers, and ecommerce businesses, as tariffs will apply based on the product’s country of origin rather than its shipping location. As a result, total landed costs will rise, potentially leading to higher prices for customers.

2. De Minimis Exemption Removed for Products Manufactured in China and Hong Kong (Regardless of Shipping Location)

Previously, businesses could send goods valued under $800 USD without duties under the De Minimis rule. That’s no longer the case. Now, all products that were manufactured in China or Hong Kong will need to go through formal or informal customs entry and will be subject to duties.

These products will be taxed based on the Harmonized Tariff Schedule of the United States (HTSUS), which includes up to three different types of duties:

3. No More Duty Refunds (Drawbacks)

Previously, businesses could recover some duties on re-exported goods through a duty drawback program. This is no longer an option for products affected by these new tariffs, which could have a significant impact on companies using China or Hong Kong as manufacturing hubs.

4. Some Products Are Exempt

Certain products manufactured in China and Hong Kong will not face the new IEEPA tariffs. However, they must still go through formal or informal entry processing under the HTSUS system. The exemptions include:

• Donations
• Informational materials (e.g., books, films, posters, CDs, and similar items)

5. Expect Delays at U.S. Customs

With the new tariffs and regulations, expect longer customs clearance times. More shipments will require detailed inspections, and businesses should prepare for potential delays as U.S. customs officials implement these new policies.

What You Can Do to Minimise the Impact

1. Get Your Commercial Invoice Right for U.S. Shipments

Accurate and complete commercial invoices are essential when shipping to the U.S., not only to avoid customs delays and inspections, but to ensure your goods aren’t overcharged with duties or refused entry.

Here’s what you need to know:

For all shipments to the U.S., make sure your commercial invoice includes:

• Sender and receiver details
• Your Tax Status
• Reason for Export
• Required Identification Numbers
• For each product:
• A clear, specific product description (what is it and what's it made of?)
• Quantity
• A 10-digit HS Code (check here to find the correct code and watch this video to learn more)
• The country of manufacture
• The product’s value and currency

Additional requirements to be aware of:

• A Manufacturer Identification Code (MID) is typically needed for textile products for commercial use. If required, you can add this in the product description. For more information on what products require a MID code and how to generate it, click here: MID Information.
• Formal entry for high-value shipments: If your shipment is valued over $2,500 USD, it will require formal entry and must include an EIN (for businesses) or SSN (for individuals). You can include them in the product description when shipping with Interparcel.

For more detailed guidance, visit FedEx’s U.S. tariff and shipping information page.

Getting your commercial invoice right the first time ensures smoother customs clearance and helps avoid costly delays and fees.

2. Communicate Proactively with Your Customers

Unexpected delivery fees or delays can impact customer trust, especially during peak sales periods.

With the new U.S. tariffs in place, many products (particularly those manufactured in China and Hong Kong) are now subject to stricter documentation checks at customs. These inspections can lead to unexpected delays or added fees if the paperwork isn’t perfect.

What you can do:

• Add a note at checkout about potential delays or fees on U.S. orders
• Update delivery estimates on your product pages and in shipping notifications
• Email customers to explain any pricing or shipping changes

Transparency goes a long way in retaining customer loyalty, especially when shipping timelines or costs may be affected by forces outside your control.

3. Diversify Your Export and Manufacturing Strategy

Reducing reliance on high-risk supply chains can protect your business long term.

Consider:

• Exploring less-affected export markets (e.g. New Zealand, the UK, Canada)
• Building relationships with alternative manufacturers in Vietnam, India, Indonesia, or Australia

4. Recalculate Pricing to Protect Your Margins

With tariff costs rising, it’s recommended to revisit your pricing strategy.

What to consider:

• Factor new import duties into your landed cost calculations
• Reassess your product margins, especially for U.S. customers
• Decide whether to absorb the cost, pass it on, or split it with the customer

You may also want to explore tiered pricing, bundle deals, or volume discounts to stay competitive without sacrificing profitability.

5. Access Australian Government Support

The Australian Government is offering guidance and tools to help businesses affected by tariff changes:

• Export Market Development Grants (EMDG)
• Business advisory services
• Educational webinars

Watch: Navigating U.S. Tariffs webinar
Explore: Government Support for Exporters

If you have any questions about how these changes impact your shipments to the U.S., our customer support team is here to help. Contact us for expert guidance on navigating these new regulations and ensuring smooth international shipping.