U.S. President Donald Trump has ordered the United States Postal Service to temporarily suspend inbound parcels from Hong Kong and mainland China until further notice. The flow of letters and large envelopes would not be affected. But the U.S. Postal Service retracted the decision after about 12 hours. The suspension was aimed to end the duty-free “de minimis” allowance that exempts small packages worth less than USD800 from import duties, used by Chinese e-commerce companies. Nearly half of all packages shipped under “de minimis” come from China, the U.S. Congressional Committee on China said in a June 2023 report. But the U.S. Postal Service and U.S. Customs were working on a mechanism to collect the extra tariff imposed on mainland and Hong Kong products to minimize disruptions to deliveries. A Hong Kong government spokesman expressed strong opposition to any attempts to undermine Hong Kong’s reputation and erode its status as a separate customs territory. The Spokesman said that if the U.S. failed to rectify “its wrongdoing”, Hong Kong would take all possible actions to defend its legitimate interests, including bringing the matter to the WTO.
Hongkong Post had earlier said it would no longer accept items containing goods for the U.S. with immediate effect. It said it would arrange the return of items that had entered the U.S. to senders. Under the de minimis exemption, an importer was not required to perform a U.S. declaration for products worth less than USD800 per day. But since the exemption was scrapped, goods worth less than USD800 per day will have to be declared in the U.S. for formal entry. A DHL Spokeswoman said the company was working with its customers, suppliers and other stakeholders to “navigate these changes, avoid disruptions to supply chains and limit adverse impact on U.S. importers and consumers”. Some mainland merchants who sell to the U.S. via e-commerce are considering raising prices to offset U.S. tariffs after cargo service providers increased their fees.
The European Union is also considering to remove the tariff-free access to tackle the online sale of “often dangerous” goods, singling out Chinese retailers such as Shein and Temu as a major source of these products. Currently, packages valued at under €150 can be sent to the European Union without paying tax. But with 12 million small-value parcels entering every day – 91% of which come from China, according to the Commission – customs regimes are overwhelmed. The volume of small packages entering the EU rose from 1.9 billion to 4.2 billion a year between 2023 and 2024. Previous studies have estimated that the EU could recoup €1 billion a year in tax if it applied a simplified tariff to these packages by 2027. Under the new proposals, customs authorities drowning in small packages will also charge a handling fee, to be paid by the platform, the individual seller on the platform, or an intermediary that each company would have to establish in Europe for this purpose, the South China Morning Post reports.
