Postal traffic to US plunged as tariffs hit cheap goods, U.N. agency says

Global postal traffic to the United States dropped dramatically immediately after the Trump administration ended an exemption allowing goods worth $800 or less to enter the country duty-free, the United Nations postal organization says.

According to preliminary data from 192 member countries, the Universal Postal Union said Saturday that traffic to the United States declined by 81 percent on Aug. 29 compared with the previous Friday, underscoring some of the disruption that accompanied the rule change.

The de minimis exemption expired at 12:01 a.m. that day, meaning that low-value parcels are now subject to a 10 to 50 percent levy that coincides with the tariff rate of the country of origin, or a flat rate of $80 to $200, depending on which option the merchant chooses.

The new rules place the burden of customs duty collection and remittance on transportation carriers or U.S. Customs and Border Protection-approved third parties, the Switzerland-based UPU said. But the agency said carriers signaled that they weren’t willing or able to collect the levies, and postal operators said they did not yet have links with the approved third parties.

The change caused “major operational disruptions,” the U.N. agency said. And 88 postal operators notified the UPU that they suspended some or all postal services to the U.S. until a solution was implemented, it added. They included Germany’s Deutsche Post, France’s La Poste and Mexico’s Correos de Mexico.

“The global network saw postal traffic to the US come to a near halt after the implementation of the new rules,” the agency said.

The White House and CBP did not immediately respond to requests for comment early Sunday.

In an effort to ease the disruption, the UPU said it is rolling out a tool for postal operators to calculate how much tax is owed on a package at its point of origin. UPU Director General Masahiko Metoki said the organization’s landed-cost calculator “will help get mail moving to the United States again.”

For nearly a century, the de minimis rule allowed low-cost merchandise to bypass import taxes. But the Trump administration argued that it enabled drugs to enter the U.S. undetected and created a loophole that foreign businesses took advantage of to avoid paying customs duties.

Trump ended the exception for China and Hong Kong in May and extended that suspension to all countries in an executive order signed in July.

The change in rules comes as the Trump administration has set a broader goal of reducing the U.S. trade deficit with many countries – including by imposing sweeping tariffs on its trading partners. The tariffs, combined with the suspension of the de minimis rule, have caused significant uncertainty for small businesses and consumers, with many overseas suppliers declining to ship their goods to the country until the question of who will bear their cost becomes clearer.

The confusion among postal operators and businesses is partly due to how quickly the rule was implemented, the UPU said in a prior news release. Metoki, its director general, sent a letter to Secretary of State Marco Rubio on Aug. 25 to express UPU member countries’ concerns about operational disruptions, it said.