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One of the biggest biases in American life is the idea that Republicans are “good for business.” But if you’re a business with any need to receive commercial parcels from other countries, Republicans are pretty bad for you right now.
Numerous industrialized countries throughout Europe and Asia have suspended business parcel shipments to the U.S. in advance of a Friday change to the so-called de minimis rules. In most countries, only letters and gift parcels under $100 are being let through, though postal services in Italy, Lithuania, Bosnia-Herzegovina, Thailand, the Czech Republic, and others have suspended sending all packages to the U.S. regardless of value. E-commerce firms like Etsy and eBay have also suspended shipping of U.S.-bound parcels from some countries. Private shippers like FedEx could be used, though that will be much costlier.
Before this year, any shipment valued under $800 was allowed to enter the country without duties or inspection. This created a surge of packages, primarily from China, getting around normal shipping processes, thus enabling Chinese e-commerce retailers like Shein and Temu to charge shockingly low prices for goods suspected of being made with slave labor and violating copyright. As Shein and Temu grew, textile factories across the U.S. shut down and lawmakers searched for a solution.
Back in May, the Trump administration ended the de minimis exemption for China and Hong Kong, after an initial order was delayed for three months because no structure for collecting that many tariffs and conducting that many inspections—millions per day—was laid out. The administration appears to have done the exact same thing on packages from other countries, advancing the policy before devising the infrastructure.
International postal services are obligated under the Trump order to collect the duties and taxes, and they need systems in place to do that. There are third parties like Zonos that are certified to collect on behalf of an international postal system, and that might be a work-around, but those relationships have to be established. There’s an actual international system to smooth out these kinds of disputes called the Universal Postal Union, but good luck getting the Trump administration to submit to the dictates of an international consortium.
I should say that this isn’t that big a deal. As Lori Wallach of Rethink Trade pointed out over email, only 10 percent of de minimis packages enter the country by post, and the eventual working out of the China ban on de minimis has led to a substantial drop in this kind of package volume. It’s just one of life’s little hassles, and an unnecessary one. For small entrepreneurs, even short-term delays or cost spikes from shipping through more expensive services could be fatal to their business. |
