Delivered Duty Paid (DDP) is an international shipping term where the seller pays all duties and taxes and takes on most of the risks to deliver goods to the buyer’s doorstep. For many Amazon FBA sellers and e‑commerce businesses, DDP shipping from China to the United States simplifies logistics and gives buyers a seamless experience. However, tariff changes in 2025 have made DDP more complicated and raised concerns about cost transparency. This guide explains how DDP shipping works, outlines the latest regulatory changes and helps you decide if DDP is right for your shipments.
What is DDP Shipping?
Definition and Responsibilities
Delivered Duty Paid (DDP) is an Incoterm that requires the seller to deliver goods to a named place in the buyer’s country and pay all costs associated with transportation, export and import customs clearance, duties, taxes and insurance. Under DDP:
- The seller arranges and pays for transportation to the buyer’s location, handles both export and import customs clearance, pays all import duties, taxes and other charges, and ensures the goods are delivered to the final destination.
- The buyer simply takes possession of the goods upon delivery and has minimal involvement in logistics.
In contrast, Delivered Duty Unpaid (DDU) means the seller delivers goods to a place in the buyer’s country but the buyer pays import duties and taxes and handles import customs clearance.
Pros and Cons of DDP
Advantages:
- Simplicity for buyers – DDP simplifies the import process and reduces risk for buyers because the seller handles all logistics and customs charges.
- Predictable total cost – Buyers receive a clear total price, as all duties and taxes are included in the seller’s price.
- Faster customs clearance – DDP reduces the risk of delays at customs by ensuring all documentation and payments are handled up front.
Disadvantages:
- High responsibility for sellers – Sellers take on significant responsibilities, including managing import regulations and paying duties and taxes, which can eat into margins.
- Higher prices – Sellers may raise prices to cover the additional costs and risks associated with DDP.
- Complexity in multiple markets – For small businesses shipping to multiple countries, handling customs fees for each destination can be complex and time‑consuming.
Recent Tariff Changes Impacting DDP
The U.S. government imposed significant tariff increases on goods originating from China, Hong Kong and Macau in 2025. These changes have made DDP rates more volatile and introduced new compliance risks:
- Elimination of de minimis exemption – As of May 2 2025, goods made in China and Hong Kong are no longer eligible for duty‑free entry under the $800 de minimis threshold. All imports, regardless of value, must pay duties and taxes
- IEEPA Reciprocal Tariffs – Effective April 10 2025, a reciprocal tariff schedule increased tariff rates on Chinese goods to 125 %, resulting in a combined rate of 145 % when added to other existing tariffs.
- Temporary reduction – On May 12 2025, the U.S. announced a 90‑day reduction in tariff rates on Chinese and Hong Kong goods, lowering rates from 145 % to 30 %. However, this reduction does not restore the de minimis exemption.
- Postal shipments – Postal packages from China and Hong Kong are subject to a 54 % duty or a $100 flat fee per item, down from 120 %, but still higher than pre‑2025 levels.
These policy shifts mean that DDP quotations can change quickly. Forwarders must include current duty rates in their pricing or risk under‑collecting customs charges.
When is DDP Shipping Suitable?
DDP can be advantageous in specific circumstances, particularly for businesses seeking predictability and customer satisfaction. Consider DDP when:
- Your buyers expect door‑to‑door service – DDP offers a hassle‑free buying experience because customers don’t have to manage customs paperwork or pay extra fees.
- Goods are high value or regulated – Complex shipments involving electronics or luxury goods benefit from a forwarder handling compliance and duty payments to avoid delays and seizures.
- You are shipping small to medium volumes – DDP often makes sense for shipments under 100 kg or a few pallets because the all‑inclusive rate simplifies cost calculation.
- You need to build trust – Providing a single price can improve buyer confidence and reduce shopping cart abandonment.
However, if you have significant experience with customs clearance or your buyers prefer to manage their own imports, DDU or other Incoterms may be more cost‑effective.
Alternatives to DDP
Delivered Duty Unpaid (DDU) – The seller is responsible for shipping to the destination port and providing documentation, but the buyer pays import duties, taxes and handles customs clearance. This arrangement offers buyers control over import costs and may reduce the seller’s financial risk. It is suitable when buyers are experienced importers or have favorable duty agreements.
Delivered at Place (DAP) – Similar to DDU, the seller delivers goods to an agreed destination, clears export customs and bears transportation risks. The buyer pays import duties and taxes once the goods arrive. DAP provides more certainty than DDU about delivery location but still leaves import costs to the buyer.
EXW, FOB and CIF – Other Incoterms, such as Ex Works (EXW), Free On Board (FOB) and Cost, Insurance and Freight (CIF), split responsibilities and costs differently. EXW puts most responsibilities on the buyer, FOB splits them at the port of loading, and CIF includes insurance and freight to the destination port. These terms may be more appropriate for high‑volume or bulk shipments where buyers manage logistics.
Tips to Manage Costs and Risks in DDP Shipping
- Stay updated on tariff changes – Monitor U.S. Customs and Border Protection and logistics news for changes to tariff rates and de minimis rules. Tariff reductions can temporarily lower costs, while new executive orders may raise them.
- Work with transparent forwarders – Choose freight forwarders who clearly explain how they calculate duties and declare product values. Avoid those who offer suspiciously low kilo rates that may involve undervaluation.
- Factor duties into pricing – Include expected duties and taxes in your product pricing to protect your margins. Some sellers mark up prices slightly to cover unpredictable tariff changes.
- Document product values accurately – Provide correct commercial invoices and product descriptions. Undervaluation can lead to fines, seized goods or legal trouble, and intentionally misdeclaring values is risky.
- Consider insurance and transit time – Because tariffs may change during transit, choose shipping methods with predictable transit times and ensure your goods are insured against loss or damage.
- Consult experts – DDP shipping can be complex. Consulting with experienced logistics providers can help you navigate customs regulations, avoid compliance issues and develop the right shipping strategy.
For professional advice on DDP shipping and tailored logistics solutions, feel free to contact us.