US ends tariff exemption for small packages shipped globally

WASHINGTON

The United States on Aug. 29 ended tariff exemptions on small packages entering the country from abroad, in a move that has sparked concern among small businesses and warnings of consumer price hikes.

President Donald Trump's administration cited the use of low-value shipments to evade tariffs and smuggle drugs in ending duty-free treatment for parcels valued at or under $800.

But exclusions for some personal items and gifts remain.

Instead, packages will either be subject to the tariff level applicable to their country of origin, or face a specific duty ranging from $80 to $200 per item. But exclusions for personal some personal items and gifts remain.

Trump's trade adviser Peter Navarro told reporters that closing this "loophole" helps restrict the flow of "narcotics and other dangerous and prohibited items" while bringing fresh tariff revenues.

But the monthlong lead time Trump's order provided has sparked a frenzy.

Postal services, including in France, Germany, Italy, India, Australia and Japan, earlier said most US-bound packages would no longer be accepted.

The UK's Royal Mail, which took a similar step, announced new services on Aug. 28 for customers to continue sending goods to the United States.

U.S. officials maintain that just five percent of duty-free small package shipments arrived via the postal network, while most went through express couriers.