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New research suggests President Donald Trump’s latest tariffs on imports from China could have a bigger impact on the American economy than official U.S. trade data indicate. The impact, according to a study from economists at the Federal Reserve Bank of New York, will be especially severe if the Trump administration ends favorable treatment of so-called de minimis imports—or those valued at less than $800.
“U.S. imports from China have decreased by much less than has been reported in official U.S. statistics,” Hunter L. Clark, a New York Fed researcher, wrote in a blog post published today. “As a result, the recent tariff increase on China could have a larger impact on the U.S. economy than is suggested by official U.S. data on the China import share.”
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There is little doubt that a harsher treatment of Chinese products under the first Trump administration, much of which was continued by the Biden White House, reduced China’s share of U.S. imports. But by how much? The answer varies depending on which country you choose to believe.
U.S. data shows that imports from China declined to 13.4 percent of total imports to the United States in 2024, down from 21.6 percent in 2018. In nominal terms, imports fell by $66 billion, to $439 billion, in that time frame. But China’s data tells a different story. It shows that “exports as a share of the U.S. import market have only declined by 2.5 percentage points, less than one-third of the decline shown in the U.S. data,” according to Clark’s blog post. China’s data also says that rather than falling by $66 billion, the nominal value of exports increased by $91.2 billion, to $524 billion.
“Simply stated, the U.S. is saying it buys from China a lot less than what China says it is selling,” Clark wrote. Thus, the impact of the new tariffs could be bigger than expected.
The hit will be amplified if Trump does away with the de minimis exemption for direct-to-consumer imports. The threshold for de minimis orders was increased from $200 to $800 in 2016, contributing to “explosive growth” in those orders, which likely accounts for a large portion of the discrepancy between U.S. and Chinese statistics, according to Clark.
Since returning to the White House in January, Trump has imposed a new 10 percent tariff on Chinese goods. He also announced, then delayed, a plan to end tariff exemptions for de minimis merchandise from China and Hong Kong. Those smaller imports are challenging to measure but growing fast. Figures from China conflict with estimates from the Congressional Research Service, but both sources suggest the volume has surged.
“It appears highly plausible that the U.S.’s de minimis imports from China increased by at least 50 percent, or even more than doubled, and were in excess of $50 billion last year,” Clark wrote. “This suggests that U.S. consumers could face larger consequences than meet the eye from the recent 10 percentage point tariff increase, if the de minimis exception is ended for China and Chinese sellers do not slash their profit margins by reducing their export prices.”
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