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Temu steers users to 'local' products after Trump shuts tax loophole

Chinese online retailer Temu has been surfacing more products on its app that can be shipped from warehouses in the U.S. following President Donald Trump's decision to revoke a popular tax loophole.

The nearly century-old exception, known as de minimis, has been used by many e-commerce companies to send goods worth less than $800 into the U.S. duty-free. Trump on Saturday suspended the exemption as part of new tariffs that include an additional 10% tax on Chinese goods.

De minimis has helped propel Temu and Shein's explosive growth in the U.S. by allowing the companies to bypass taxes on low-value shipments, and sustain their rock-bottom prices on everything from shoes and clothes to furniture and electronics.

With the tariff exemption gone, Temu has significantly ramped up its promotion of sellers who have inventory in U.S. warehouses, rather than items that are shipped direct from China. A scan of listings in Temu's "Lightning deals" section shows that it's almost entirely dominated by products with a green "local" badge.

By promoting local inventory, Temu's products not only arrive faster to shoppers' doorsteps, but the company also reduces its reliance on sellers who ship direct from China. Even though the products are stored in U.S. warehouses, many local listings state that the items are sold by businesses based in China.

Representatives from Temu didn't respond to requests for comment.

Temu's promotion of U.S.-based products also puts it in more direct competition with Amazon, eBay and Walmart, which have also signed up sellers in China who ship goods overseas to their warehouses. Amazon last year took notice of Temu and Shein's dramatic growth in the U.S. when it launched its own budget storefront, called Haul.

Temu,

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