A three-judge panel of the US Court of International Trade on August 13, 2026, ruled that President Donald Trump had the legal authority to terminate the long-standing “de minimis” tariff exemption for low-value imports, delivering a legal victory to his administration's trade policy.
The exemption had allowed shipments valued at $800 or less to enter the United States without customs duties and with limited inspection requirements. Trump moved to end the exemption in 2025, including for shipments from China, Mexico and Canada, as part of his broader efforts to tighten trade rules and increase tariff revenue, as per Reuters.
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The court held that the International Emergency Economic Powers Act (IEEPA) gave Trump sufficient authority to revoke the duty-free treatment during an economic emergency. The judges also rejected arguments that the action improperly interfered with Congress's constitutional authority over taxation and government revenue.
The case was brought by Detroit Axle, a Michigan-based auto-parts importer, which challenged the administration's decision in May 2025. The company argued that Trump did not have the authority to terminate the exemption before Congress's legislation was scheduled to end it in July 2027. The court rejected the challenge.
The ruling also drew an important distinction between ending an existing tariff exemption and imposing entirely new tariffs. It therefore does not necessarily establish unlimited presidential authority to create new tariffs under IEEPA.
The decision comes after the US Supreme Court earlier struck down the bulk of Trump's IEEPA-based tariffs, but that ruling did not directly resolve the separate issue of the de minimis exemption, according to Reuters.
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Trump welcomed the decision, calling it a “BIG WIN” and arguing that the exemption had become a loophole exploited by tariff evaders, drug traffickers and counterfeiters. The administration has estimated that the exemption cost the U.S. more than $10.8 billion in revenue in 2024.
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