scrapping

Aug. 14 (UPI) — A federal trade court threw out a legal challenge to President Trump’s executive order scrapping the so-called “de minimis” exemption loophole under which goods worth less than $800 could enter the United States duty free.

Three judges sitting in the U.S. Court of International Trade ruled Thursday that Trump had the legal authority to invoke the International Emergency Economic Powers Act to eliminate de minimis, in contrast to his April 2025 “liberation day” global tariffs which it ruled were unlawful, a decision the Supreme Court subsequently upheld.

“In reaching this conclusion, we find that the President’s power to ‘nullify [or] void . . . exercising any . . . privilege’ does not run afoul of separation of powers principles,” they wrote in their judgment.

The judges found the removal of the exemption did not constitute “an exercise of the power of the purse” and “is not an exercise of the power to legislate.”

In the global tariffs case, the Supreme Court came to the opposite conclusion, ruling that Trump could not act without approval from Congress.

Trump hailed Thursday’s ruling as a “big win” for his resolve to get rid of what he said was a “ridiculous giveaway… one of the most DESPICABLE loopholes in American Trade Policy” that he said was costing the U.S. Treasury more than $10 billion in revenue from tariffs that it would otherwise receive.

“For years, Foreign Shippers could send packages worth up to $800 into our Country, DUTY FREE, NO TARIFF, far less scrutiny. It became a giant loophole for TARIFF Cheats — and a Pipeline exploited by Fentanyl Traffickers, Counterfeiters, and other Criminals shipping dangerous and illegal products into America. The numbers were staggering. In 2024 alone, de minimis cost America an estimated 10.8 BILLION DOLLARS in foregone TARIFF Revenue, and an astonishing share of narcotics and counterfeit seizures came through the de minimis channel,” said Trump.

Detroit Axle, a Michigan-based auto-parts distributor, brought the de minimis case last year on grounds Trump had overstepped his authority under IEEPA. The firm’s legal counsel did not immediately comment on the ruling.

U.S. Customs and Border Protection netted more than a billion dollars in 2025 from the ending of de minimis and the court ruling clears the way for it to continue until it is permanently eliminated when Trump’s One Big Beautiful tax cut and spending bill kicks in next July.

WASHINGTON — Acting Atty. Gen. Todd Blanche said Tuesday that the Trump administration was scrapping plans to create a $1.8 billion fund meant to compensate allies of the Republican president after widespread political backlash and setbacks in the courts.

“We are not moving forward with the fund, period,” Blanche said in response to questions at a House hearing on the Justice Department budget.

““Not moving forward, ever?” asked Rep. Grace Meng, a New York Democrat.

The blunt declaration marked an extraordinary turnabout for a Trump Justice Department that just two weeks ago had pronounced the fund as essential to make up for what officials insist was weaponized law enforcement during President Biden’s Democratic administration. Since then, though, the idea has faced mounting pressure from Republicans who demanded reassurances that plans for the fund were off the table before they would move forward with legislation funding President Trump’s immigration enforcement agencies.

Blanche said the Justice Department was not abandoning an element of a settlement with the IRS that gave Trump and his family immunity from tax audits.

The hearing before a House Appropriations subcommittee was scheduled for discussion of the Justice Department’s budget, but lawmakers quickly focused their questioning on the creation of a fund that has provoked outrage over the mere possibility that violent pro-Trump rioters who stormed the U.S. Capitol on Jan. 6, 2021, could be eligible for payouts.

Signs for the retreat surfaced Monday when a person familiar with the matter said the Republican president was now reconsidering whether to move forward with the fund established to resolve his lawsuit against the Internal Revenue Service over the leak of his tax returns. The Justice Department also said Monday it would comply with a Virginia court temporarily blocking the administration’s “Anti-Weaponization Fund,” effectively agreeing to pause the plan for at least two weeks.

Another judge in Florida raised the prospect of reopening the IRS lawsuit because of “grievous allegations” of improper dealing made against the administration by settlement critics.

The Trump administration has defended the fund as an appropriate measure to make up for what officials insist was a weaponized Justice Department during President Joe Biden’s Democratic administration, a claim the Biden administration strongly denied. Though some Trump supporters, including participants in the Capitol riot, have celebrated the announcement, the reaction among Republicans in Congress has been decidedly more hostile, forcing Blanche to try to assuage a GOP constituency that generally operates in close alignment with the administration.

The furor has especially complicated matters in the Senate, where Republicans defiantly left town 10 days ago without passing legislation to fund Trump’s immigration enforcement agencies. Republicans who returned to Washington on Monday said they won’t have the votes to pass the Homeland Security spending bill until the White House works with them to place parameters on the fund. Many have pushed the administration to impose limits or scrap the idea altogether.

At a Senate budget hearing last month, Blanche refused to rule out the possibility that those who carried out violence on Jan. 6 could be eligible for payouts and has repeatedly said in interviews that anyone who feels persecuted by the criminal justice system is free to apply. Payouts will be decided by a five-member commission appointed by Blanche.

But he has apparently struck a more conciliatory tone in private when confronted by Republican anger.

Blanche encountered a groundswell of opposition last month at a tense private meeting with GOP senators, with more than half raising concerns, including by shouting at the Justice Department’s top official, Republican Sen. Ted Cruz of Texas said in a recent episode of his podcast.

“There were fireworks at an epic level — and I’ve got to say, it’s one of the roughest meetings I’ve seen in my entire time in the Senate,” Cruz said.

Behind closed doors, Blanche was “adamant” that no one who assaulted police at the Capitol would receive compensation, according to Cruz.

“He said not just ‘no,’ but ‘hell no,’” the senator recalled.

Tucker and Richer write for the Associated Press.