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The U.S. Postal Service has reversed its decision to ban all inbound packages from China and Hong Kong, effective immediately. The ban was announced on Tuesday after the U.S. imposed a 10% tariff on Chinese goods and ended a customs exemption that allowed small-value parcels to enter the U.S. without paying tax.
The Postal Service did not provide a reason for the reversal, but said it would work with Customs and Border Protection to implement a collection process for the new China tariffs to avoid delivery disruptions.
The ban had the potential to create massive disruptions for online shopping platforms like Shein and Temu, popular with younger shoppers in the U.S. for cheap clothing and other products, usually shipped directly from China.
Under the new tariffs, analysts say consumers are likely to see price hikes and potential delays in shipments from companies like Shein and Temu.
Letters and flats — mail that measures up to 15 inches long or 3/4 inches thick — were not included in the brief ban.
The USPS did not give a reason for the ban on Tuesday, but the suspension came after Trump closed the “de minimis” customs exemption this week for China that allowed shoppers and importers to avoid duties on packages worth below $800. The exemption was removed as part of an executive order to levy a 10% tariff on Chinese goods.
U.S. Customs and Border Protection previously stated that it processes an average of over 4 million “de minimis” imports each week. It also gave no reason for its decision on Wednesday and did not immediately respond to requests from The Associated Press for comment.
China’s exports of low-value packages soared to $66 billion in 2023, up from $5.3 billion in 2018, according to a report released last week by the Congressional Research Service. In the U.S., Temu, which is owned by China’s PDD Holdings, and Shein comprise about 17% of the discount market for fast fashion, toys and other consumer goods, the report said.
Alibaba’s AliExpress has also commonly used the trade loophole. Neil Saunders, a managing director with research firm GlobalData, noted some businesses who sell through Shopify and other e-commerce platforms, such as Etsy, also ship packages to consumers directly from China. Amazon does the same for a subset of products sold through Amazon Haul, a low-cost online storefront it launched last year to better compete with Shein and Temu, which rely more heavily on de minimis.
What’s Likely to Happen Next?
Under the new tariffs, consumers are likely to see price hikes and potential delays in shipments from companies like Shein and Temu. The U.S. imported about $427 billion worth of goods from China in 2023, the most recent year with complete data, according to the U.S. Census Bureau. Consumer electronics, including cellphones, computers and other tech accessories, make up the biggest import categories.
Conclusion
The reversal of the ban on inbound packages from China and Hong Kong is a relief for online shoppers in the U.S. who rely on affordable clothing and other products from these countries. However, the new tariffs are likely to lead to higher prices and potential delays in shipments, which may impact the businesses that rely heavily on these imports.
Frequently Asked Questions
Q: Why did the USPS ban inbound packages from China and Hong Kong?
A: The USPS banned inbound packages from China and Hong Kong after the U.S. imposed a 10% tariff on Chinese goods and ended a customs exemption that allowed small-value parcels to enter the U.S. without paying tax.
Q: What happened to the ban?
A: The USPS reversed its decision to ban inbound packages from China and Hong Kong, effective immediately. The ban was announced on Tuesday and was lifted on Wednesday.
Q: How will the new tariffs affect online shoppers?
A: The new tariffs are likely to lead to higher prices and potential delays in shipments from companies like Shein and Temu, which rely heavily on imports from China.