What's Happening?
The United States has seen a dramatic 80% drop in postal traffic following the Trump administration's decision to end the tariff exemption for low-value parcels. The Universal Postal Union (UPU) reported that numerous postal operators have halted services to the U.S. due to the new requirement for customs duty collection on parcels valued at $800 or less. The exemption, known as the 'de minimis' rule, previously allowed low-cost imports to enter the U.S. without customs charges. The change, effective August 29, 2025, shifts the duty collection responsibility to transportation carriers or U.S. Customs and Border Protection-approved parties.
Why It's Important?
The removal of the de minimis exemption has significant implications for international trade and postal services. The exemption was perceived as a loophole that foreign businesses used to evade tariffs and criminals exploited to smuggle drugs into the U.S. The new rules aim to close this loophole, potentially increasing customs revenue. However, the sudden change has disrupted global postal operations, affecting businesses and consumers dependent on low-cost imports. This policy shift reflects broader trade and security priorities under President Trump, emphasizing tighter controls on imports and customs enforcement.
What's Next?
The UPU is implementing measures to assist postal operators in complying with the new U.S. customs requirements. The disruption in postal traffic may lead to negotiations between international postal agencies and U.S. authorities to find solutions that minimize operational impacts. Businesses affected by the change may seek alternative shipping methods or adjust their import strategies. The long-term effects on international trade and postal services will depend on how quickly stakeholders can adapt to the new regulations and whether further policy adjustments are made.
