NEW ORLEANS – Postal shipments to the U.S. have dropped more than 80% since the Trump administration ended a long-standing tariff exemption for low-value imports, according to the Universal Postal Union (UPU), a United Nations organization.
The change, which took effect on Aug. 29, ended the de minimis exemption that had been in place since 1938, allowing parcels valued at $800 or less to enter the U.S. duty-free.
“The global network saw postal traffic to the U.S. come to a near-halt,” the UPU said in a statement.
The UPU said it had warned Secretary of State Marco Rubio before the order was signed on July 30 that postal networks were unprepared for such an abrupt change, but the Trump administration argues the decades-old exemption had become a loophole exploited by foreign firms and smugglers.
Under the new policy, goods now face tariffs ranging from 10% to 50%, though Americans can still receive up to $100 in gifts or $200 in souvenirs duty-free. The new rules require customs duties to be collected by transportation carriers or other U.S. Customs-approved parties, a responsibility many carriers say they cannot meet.
Global Disruption Follows U.S. Policy Shift
As a result, 88 postal operators, including organizations like Canada Post, Royal Mail (United Kingdom), La Poste (France), Japan Post, India Post, and similar entities across the world have suspended some or all U.S.-bound services, bringing global postal traffic to the country to a near standstill.
The disruptions also stem from a lack of systems linking them to U.S. Customs and the refusal of airlines and other carriers to assume liability for collecting tariffs.
Rising Costs for Small Businesses and Consumers
For many small firms, the change means higher import costs, new paperwork, and difficult decisions about pricing and product selection. Businesses that rely on low-cost overseas inputs may find it harder to compete, while startups and microenterprises could face new barriers to entry.
Economists and policy analysts warn that ending the long-standing de minimis exemption for low-value imports could have serious consequences for small businesses across the United States. Research from the National Bureau of Economic Research found that lower-income ZIP codes rely more heavily on de minimis imports, meaning the rule change could raise costs for both small firms and their customers who depend on affordable goods.
A Yale University analysis estimated that removing the exemption could add at least $10.9 billion in costs to American consumers, roughly $34 per person, and as much as $13 billion when accounting for shipments from China. The study concluded that these costs would fall most heavily on lower-income households.
The Brookings Institution described the sudden end of de minimis privileges as disruptive to supply chains and e-commerce models that depend on high volumes of small parcels. It warned that rapid implementation, rather than a gradual phase-out, risks creating uncertainty for postal networks, airlines, and businesses that rely on consistent international shipping.
Trade groups representing industries such as printing and promotional goods have also voiced concern. They argue that the rule will raise production costs, increase administrative complexity, and force small manufacturers to reconsider their sourcing strategies or warehouse operations.
Industry Reactions Divided
While many analysts and industry associations have warned of economic disruption, some manufacturing and labor groups have welcomed the change as a necessary correction.
Groups representing U.S. manufacturers, including the National Council of Textile Organizations (NCTO), praised the policy as a long-overdue step to protect domestic production. The NCTO argued that the exemption had allowed cheap, subsidized apparel and textile goods to enter the country duty-free, undermining American factories and jobs. It said the change would restore fair competition and reduce the influx of illicit or counterfeit products.
At the same time, major business and trade associations have warned that eliminating the exemption will harm small firms and raise prices for consumers. The National Foreign Trade Council, U.S. Chamber of Commerce, National Association of Manufacturers, Consumer Technology Association, TechNet, and Express Association of America joined in a letter urging the administration to reconsider the decision.
These organizations said the de minimis threshold has helped U.S. small businesses compete globally by lowering transaction costs, simplifying customs processes, and supporting cross-border e-commerce. The coalition warned that removing the exemption could double the cost of low-value shipments without meaningfully improving border enforcement.
The U.S. Chamber of Commerce has argued that de minimis shipments are screened like other imports. In a coalition letter co-signed by the Chamber, major business groups warned that eliminating the exemption could substantially increase the cost of typical low-value shipments and add inflationary pressure.
