US President Donald Trump’s executive order to end duty-free entry for cheap Chinese goods has caused chaos, with millions of packages piling up at ports of entry and the US Postal Service struggling to implement a new tariff collection system.
The policy change, announced last month, aims to increase revenue from tariffs on low-value shipments. However, it has created significant challenges for logistics companies, including FedEx, UPS, and DHL, which have in-house customs brokerage divisions that collect tariffs owed by package recipients.
The US Postal Service (USPS), which accounts for a small percentage of total de minimis shipments, is seen as the Achilles heel of any policy to remove tariff exemptions on low-value shipments. It does not have the necessary infrastructure to assess and process duties on packages coming from abroad.
“We have absolutely no way, ourselves, to collect duty or pay duty to the government,” said Cindy Allen, CEO of Trade Force Multiplier, an international trade consultancy service.
The USPS has temporarily stopped accepting incoming packages from China and Hong Kong as it works to figure out how to collect duties. Experts say that the postal service would likely need to partner with customs brokers or be exempted from the new rules to start processing duty on millions of incoming packages.
The Trump administration plans to reinstate the ban on de minimis “in short order,” but experts warn that a rollout could be chaotic, given the complexity of global shipping routes and the need for more personnel to inspect incoming packages.
“It’s going to be chaotic, no matter what,” said Lars-Erik Hjelm, a lawyer specializing in international trade law.
Source: https://www.reuters.com/world/us/trump-closed-de-minimis-import-loophole-until-all-hell-broke-loose-2025-02-14