HONOLULU (KHON2) — Hawaiʻi shoppers are beginning to feel the effects of new federal trade rules that close a long-standing loophole on imported goods.
The de minimis exemption, which previously allowed packages valued under $800 to bypass duties and taxes, has now been scaled back, which means higher costs and potential shipping delays for consumers across the islands.
Retail Merchants of Hawaiʻi President Tina Yamakai says the change is a double-edged sword.
“It’s good and bad,” Yamakai said. “The good part is it kind of levels out the playing field for our local retailers who ship internationally. But for consumers, the price is going up. You’re going to have to pay the tax now.”
The sudden change has caught many international shipping companies off guard. Some countries have temporarily suspended service to the U.S. altogether until they better understand the new requirements. Some of those countries include: Australia, France, Germany, Greece, India, Italy, Japan, Norway, Portugal, Singapore, South Korea, Spain, Switzerland, Taiwan and Thailand.
“Because this order came so fast, a lot of the shipping companies didn’t have time to figure it out,” Yamakai said. “So some have just said, ‘Forget it, we’re not shipping to the U.S. until we know what’s going on.’ That’s sad for the consumers and the retailers waiting for those shipments.”
The impact is especially tough for residents and small businesses, which relies heavily on imports for everyday goods. Yamakai says shoppers could see price increases not only online, but also in local specialty stores that order from overseas.
“Hawaiʻi has so many specialty stores tied to different cultures,” she said. “All of that will be impacted. And you’ll probably see more price increases on online shopping too.”
One potential benefit is a reduction in counterfeit goods, which often slip into the U.S. market through low-cost international shipments.
“Those five-dollar knockoff shirts? They might end up costing a lot more now,” Yamakai said. “And that could help reduce some of the counterfeiting.”
With the holiday shopping season approaching, Yamakai advises consumers to plan early and consider keeping their dollars local.
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“Continue to shop local and support our local businesses,” she said. “Even national stores here hire our local people. It’s a great way to support everybody.”