Tariffs and Selling on eBay

This is more by way of editorial musing than anything else, add your own thoughts on the subject! 

 

It has struck me, watching Trump hurling insults and happily initiating trade wars lately, that his recently announced heavy (and extensive) tariffs on Chinese goods may, like most things he does, have unintended consequences -- or at least consequences Trump hasn't foreseen, thought about, or cared about. 

 

In his bull-in-a china-shop manner (pun intended), it seems likely that Trump will deal a serious blow to a lot of U.S. retailers who depend largely upon imports from China (including giants like Walmart).  EBay is no exception.  I have to wonder whether eBay may soon rue the day it turned its back on the millions of small, independent sellers that used to make up its primary selling base, who would now be an insurance policy against such events.   I can't see ca. 25% tariffs on Chinese goods coming into the U.S. as not having a serious impact on eBay's bottom line, especially when the proposed list includes many common household products. 

 

On the other hand, Canadian eBay buyers who purchase directly from Canadian sellers will benefit (assuming our government doesn't follow suit with tariffs on China -- and why would they?).  I wonder whether eBay Canadian sellers who source their products in China will still be able to sell them across the border into the U.S. tariff-free?  

 

So ironically, one of the unintended consequences of Trump's "big idea" to get back at China might be to actually bolster Canadian retailers' fortunes.  I believe there's a saying for that: "every cloud has a silver lining".  

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@femmefan1946 wrote:

 

pjcdn- thank you for the correction. I was under the impression that the increase was about a decade ago.

 


Yeah, 'pj' is right, it was fairly recently that the de minimus was increased so dramatically.  The reason it stuck in my mind is that I regularly sell items to the U.S. that used to be over the $200 ceiling and was thrilled when the level was increased.  I could now assure my customers that they wouldn't have to worry about customs charges even for more expensive items.   

 

I did wonder why Obama's administration raised it in such a huge jump.  Maybe Trump just hasn't understood the effect of an $800 import ceiling, or -- more likely -- he's been too busy smashing things elsewhere.  

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@hlmacdon wrote:


He is already well aware of it since it has been a key part of NAFTA renegotiation with the US wishing to see Canada make at least some effort to raise the de minimus from it's current value. 

I'm wondering where you saw this reported, as I can't recall seeing any coverage on this specific point in the media (and I've been following news on NAFTA fairly closely).  I would think there are other trade/tariff issues between the U.S. and Canada that are far bigger sore spots than this one.

 

I'm just surprised the de minimus issue (in either direction) would be considered "key", since our buyer base is proportionately so much smaller than the domestic U.S. market, and personal purchases by Americans from Canada must represent a very minimal slice of the U.S. consumer picture.  Notwithstanding solely U.S.-based online venues like eBay (who have a direct interest in increasing the Canadian allowance for their U.S. sellers), most major U.S. retailers have their own subsidiaries or outlets in Canada anyway.  

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Funny you should say that.  I had an Australian buyer last night buy an Anne Murray CD.  I hope that still will be the case. 

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@rose-dee

Well Trump seems to be more about impulse and enemies than policy.

And Jeff Bezos is definitely on his enemies list.

If it occurs to Trump's voices that the duty-free allowance would hurt Bezos in any way there would be a tweet about it instantly.

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It's been baked into the initial NAFTA negotiating objectives since the start. Not really a new thing either as the pressure to match the de minimis goes back to when the US limit was raised. There has been a number of states lobbying leadership for this for several years now. Are their bigger objectives? Certainly, the main element is on commercial importations between the two countries but this specifically is a sticking point given the disparity between the two limits and the lack of reciprocity. It is important more for the symbolic value of that.

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I have seen references to the de minimus being a NAFTA negotiation sticking point at least 10 times in major media.

 

https://www.ctvnews.ca/business/nafta-sticking-points-a-list-of-impediments-holding-up-a-deal-1.3937...

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@mtheory2003 wrote:

I have seen references to the de minimus being a NAFTA negotiation sticking point at least 10 times in major media.


There was a rather amusing hyperbolic anecdote today from Trump about Canadians smuggling shoes across the border because of the low de minimus. Struck a chord given some of the rather elaborate lengths I've known people to go through to avoid paying taxes at the border. Regarding the issue itself I think it would be helpful if there was a separation between sales tax and duties given where legislation is heading regarding the taxation of online purchases. I would envisage the exemption changing, but with separate values for the sales tax threshold and duty free threshold. 

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In that article, Trump called the Canadians stupid for cross border shopping. I guess he must not be smart enough to realize all the jobs, and taxes, it created on the US side. SMH.

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@amcdc79 wrote:

In that article, Trump called the Canadians stupid for cross border shopping. I guess he must not be smart enough to realize all the jobs, and taxes, it created on the US side. SMH.


I didn't see any comments referring to Canadians as stupid in the actual video of the speech. The only comments about stupid from the speech seem to be referring the American side for allowing a large trade imbalance. I don't think it is the smartest approach to speeches, but typically he exaggerates (often wildly) to play to the audience. 

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There was a rather amusing hyperbolic anecdote today from Trump about Canadians smuggling shoes across the border because of the low de minimus. Struck a chord given some of the rather elaborate lengths I've known people to go through to avoid paying taxes at the border.

 

 

As with lacrosse, doing the "nothing to declare" spiel, has always been Canada's other national sport. 

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" I don't think it is the smartest approach to speeches, but typically he exaggerates (often wildly) to play to the audience. "

Actually for the audience Trump has in mind it is the perfect approach. That approach won him an election.

 

The whole supply management system is a separate debate but Canada is not alone in the tariff game:

 

According to CNN: The United States has a 350% tariff on some tobacco products and a 132% tariff on a peanut variety, according to the WTO.

The United States charges outsiders an average 17% tariff on dairy imports, according to the WTO. American dairy farmers also benefit from government subsidies.

"When we are criticized about some of our policies, one needs to look at the degree to which the US and other countries both subsidize their agricultural industry and put up non-tariff barriers," David MacNaughton, Canada's ambassador to the United States, said last year.

 

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@hlmacdon wrote:


There was a rather amusing hyperbolic anecdote today from Trump about Canadians smuggling shoes across the border because of the low de minimus. 


I had to laugh at this one.  Clearly nobody has told Trump about the thousands of Americans who drive over the border to get the 25% "discount" on everything they buy, and then still don't claim what they've purchased (i.e. "smuggling").   Mind you, nowadays they have to be pretty big shoppers to go over the personal limit.  Still, start a fight -- and with Canada -- over shoes?  Really?  It makes him sound like an ignorant idiot to all but his hard-core supporters.  

 

This is iconic Trump -- dream up a new insulting name for the next group he wants to vilify.  Pick on Canadians, who'd have thunk it?  I'm honestly having trouble remembering any point in my lifetime when disparaging monikers were hurled at us by other leaders.   Mexicans are rapists and murderers, so I guess we're now we're smugglers.  Join the club. 

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Hey smuggling is a grand old Canadian tradition.

The Bronfmans made their fortune with it.

And without smuggling StPierre et Miquelon would be entirely inhabited by French as a Second Language teachers and puffins.

 

https://www.youtube.com/watch?v=r93Oq6VDR_o

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@higgswtop12 wrote:

" I don't think it is the smartest approach to speeches, but typically he exaggerates (often wildly) to play to the audience. "

Actually for the audience Trump has in mind it is the perfect approach. That approach won him an election. 


Agreed it can win you an election, all sides do it to varying degrees, but when it comes to actually getting things done from a legislation point of view or getting agreements in place it can be counterproductive. 

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"Agreed it can win you an election, all sides do it to varying degrees, but when it comes to actually getting things done from a legislation point of view or getting agreements in place it can be counterproductive. "

 

While Trump would like to pass certain legislation I think being seen as the "big man in power" is much more important to him. He likes to wield power, have a big audience for his tweets and play at being king and he has a following that eats up his every inane comment.

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@widgetc wrote:

 

While Trump would like to pass certain legislation I think being seen as the "big man in power" is much more important to him. He likes to wield power, have a big audience for his tweets and play at being king and he has a following that eats up his every inane comment.


Yes indeed.   He seems to particularly revel in the 180 degree show and tell session he has with the press each time he signs a "royal decree".   See -- there's my signature, big and bold -- that's all it took.  Now it's law.  Or as a powerful king once said: "L'état, c'est moi". 

 

Invariably there is also Pence standing just behind him with his usual toady-smile.  

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