I’ve heard that Canada Post has taken similar actions but does not intend to handle prepaid duties ever. A Canadian Ebay seller says that Ebay has notified members that it will not sell Canada Post postage for shipments to the US.
From the story –
“While gifts worth less than $100 will remain duty-free, the changes mean all other packages will face the same tariff rate as other goods from their country of origin.”
Mail room conversation – “Man, this dude has a birthday six days a week. I’ve never seen so many presents arriving before.”
“Royal Mail said it was withdrawing its current US export services for businesses from Tuesday, but added it hoped to have a new system up and running within two days to allow it to comply with the new rules before they kick in.”
Can we get them to train Amazon on how to adjust? How many weeks/months did it take for them to get Ground Advantage figured out?
“Online marketplace Etsy said it was suspending shipping label purchases from 25 August for Australia Post, Canada Post, Royal Mail and Evri for US-bound packages while couriers adjusted services.”
Any bets on how many millions/billions of dollars of disruptions are going to happen to the economy in general here?
Powell may need ot go to ZERO for rates again…
I suspect that these changes will have little effect on the economy, they are more the effect of elimination of de minimis elimination than the tariffs. If no international purchases were made on Etsy or Ebay destined for the US, I do not think it would affect the economy in any way other than a reduction in Etsy or Ebay profits.
This does not mean that some businesses who have used de minimis to allow their inventory to enter the US duty free will not be affected negatively.
If there are to be negative effects of the tariffs they will be tied to larger shipments.
I stopped in to my local Canada Post Office today, and they have had NO information about any changes in shipping parcels to the USA. She even did a “fake” package on her computer, and it showed no change. The clerk said they just do whatever the computer lets them until they are told differently.
And confusion still reigns for me with freight forwarder Chit Chats. Conflicting info from various sources, but I’m sending three via them tomorrow. Fingers crossed.
List of countries halting postal package deliveries to the US (probably still growing):
- Germany - Deutsche Post and DHL Parcel Germany said that they were temporarily suspending business customer parcels to the U.S. beginning 8/23. Shipments via DHL Express are not affected.
- Belgium - suspended shipments containing merchandise starting 8/24.
- Spain - will not accept packages worth $800 or less starting 8/25.
- France - suspend shipments of business parcels to the US starting 8/25.
- Czech Republic - suspend US goods shipments until further notice starting 8/22
- Austria - no longer accepts packages bound for the US after 8/25
- UK - plans to withdraw its services for a day or two next week, before rolling out a system to deal with the requirements.
- India - temporarily stop mail service to the US beginning 8/25.
- Japan - will temporarily suspend postal packages to the US starting 8/27.
- Korea - suspend air freight packages and EMS parcels starting 8/25.
- Australia - temporarily suspended its transit service to the US and will no longer accept transit items containing goods destined for the US
(Source: Different news outlets & postal websites)
@jml thank you, I was looking for a source exactly like this! It’s still chaotic.
We all need to be clear that starting this Friday, all de minimis exemptions for packages entering the USA, from any other nation, is suspended.
This means that any package that is not a letter or a personal gift <$100 must be assessed for US tariffs–whatever the tariffs might be for the sending nation are, plus whatever tariffs are also assigned to specific product types.
This was the best sum-up article I could find tonight, but hopefully someone can find a dynamic and accurate spreadsheet of new shipping restrictions (both from carriers and governments), like @VTR found for tariffs.
‘De minimis’ exemptions set to end globally Friday: What does it mean? | Newsnation
Methinks you underestimate the contribution small businesses make to the economy. If that many small businesses go under, it will take them and their families with them. And with that, the economy.
Small Businesses Generate 44 Percent of U.S. Economic Activity – Office of Advocacy
The definition of small business is so vague that when economists talk about the importance of small business to the economy, they are talking about businesses which have significant numbers of employees.
Although the majority of small businesses in the US are 5 or fewer employees, in many industries a company with 750 or more employees is still a small business.
This is why there is never agreement as to what is good for small business, what is bad for small business, and what the difference in the performance of small business means to the economy.
Under decent economic conditions the number of small businesses, especially new small business which close their doors each year is huge.
Even a one person business which closes is a tragedy for one person, but even thousands of one person businesses which close do not significantly affect most economic measure including the unemployment rate.
Yea … that logic doesn’t match history …
The Great Depression was a severe global economic downturn from 1929 to 1939. The period was characterized by high rates of unemployment and poverty, drastic reductions in industrial production and international trade, and widespread bank and business failures around the world.
When I think of small business, I think of ourselves: Mom, & Pop(Offended by that denigrating term) /family owned/5-20 employees, many of which are related by blood or friendship to the owners.
Pulled this up-might be one of the reasons there’s so much confusion between the economist/gov. view and those who are actually in the trenches, selling and manufacturing to pay for their bed/board and kid’s(and grandkid’s) college tuition. .
AI Overview
“Large” Small businesses, also known as mid-market companies, are those that are larger than traditional small businesses but smaller than large enterprises, often defined by revenue or employee count. While the exact thresholds vary, mid-market companies bridge the gap between the <1,500 employees or $40 million in revenue typically seen in small businesses and the larger corporations. These are still distinct from large conglomerates, which are parent companies with multiple independent subsidiaries.
What defines a small business?
- SBA Definition: The U.S. Small Business Administration (SBA) defines a small business based on revenue and the number of employees, with the criteria varying significantly by industry. For example, a small business could have revenues between $1 million and $40 million annually, and employ between 100 and 1,500 people.
Where do “Large” Small businesses fit in?
-
Mid-market designation:
These businesses fall into the “mid-market” category, meaning they exceed the size of typical small businesses but are not yet considered “large” enterprises.
-
Continuum of size:
Think of it as a spectrum: Small businesses, then mid-market (or “large” small businesses), and then large enterprises.
How to determine the correct size:
- Industry-specific standards: The most accurate way to determine if a company is a “large” small business is to consult the SBA’s Table of Size Standards, which provides industry-specific criteria for revenue and employee count under the North American Industry Classification System (NAICS) codes.
I recently bought a $300 item from Britain, which was delivered today. Didn’t have to pay duty though I wonder if was automatically included in the DHL fee which I thought was extremely high.
Royal Mail used to have Book Rate - similar to our Media Mail. Could buy 4 or 5 titles at a time for a decent cost. Have the Brits done away w/ this? Alas for my rare book purchases!!
The study is here, and its definition for small business is less than 500 employees.
They generate 44% of economic activity. That is huge. Imagine if they all went out of business. It is not a drop in the bucket.
Another stat that surprised me 82% have no employees.
The majority of small businesses (82%) operate without employees, and those small employers who hire staff employ nearly half of the American workforce.
The Great Depression differed in many ways from today’s economy.
Few know that the major reason for home foreclosures during the Great Depression was most homes were bought without any equity or with minimal equity.
Buyers were able to buy a home with a very small down payment and only pay the interest on the loan. They did not amortize their loan amount, and did not have any equity to allow them to refinance their home.
In later recessions, home refinancing was a valuable safety net used by a great many Americans. Needless to say, the likelihood of a bank failure was far greater when home owners were wiped out.
There were no mortgage loan guarantees in those days.
Just one example out of many with how the economic history is not relevant to future periods.
Even the revilled Smoot Hawley tariffs had effects which would probably be different in today’s economy.
BTW the interest only mortgage, aka “buying on contract” still was offered in parts of Chicago in the late 1960s. It was used to facilitate the annual transition of neighborhoods from predominately white to predominately black. Property values dropped in such neighborhoods as black buyers were given an opportunity at home ownership. And black entrepreneurs became landlords of three and four flat apartment buildings.
Interest only mortgages evoke the images associated with the silent movie “The Perils of Pauline” with the fair maiden tied to the railroad track.
Actually, the definition on the SBA website is not that forthcoming.
It emphasizes the section of your post which is How to determine the correct size:
Fixing de minimis makes sense—scrapping a nearly century-old policy in less than a month does not.
This article features a US-based small business whose sales channels include Amazon. Interesting perspective.
CoverSeal manufactures its custom and off-the-shelf covers in Mexico and China. The company stores most of its inventory in Mexico and holds about a month’s worth of stock in San Diego, where warehouse space costs about four times as much. “Warehousing in the U.S. would kill us,” says Huening.
“I understand why people are focused on fast-fashion and cheap consumer products, because that’s what we see day in and day out,” says Simon Schropp, an economist with the consulting firm BRG. “We should also think about companies that are importing in small batches. Your coffee shop might need this one widget, and the best producer is in China.” That item would previously fall under de minimis. Now, not only will its price rise, but American firms that import the same item in large batches will likely raise their prices in the face of increased demand. “It’s just basic economics,” Schropp adds. “Industries are going to suffer, not just consumers.”
From a Marketwatch story yesterday –
“Shares of Etsy Inc. and eBay Inc. have been down sharply over the past week, with analysts pinning the moves on the Trump administration’s closure of a trade loophole on Friday.”
Chart from today is not looking pretty –
Plenty of reasons for Etsy stock to drop, The fact the de minimus is viewed to have a great affect is the fact that there is a ton of so-called “hand-made” items on Etsy which is made in Chinese factories. The emperor has no clothes.
The number of Canadian Ebay sellers who are being frozen out of the US market is large, but not large enough to be likely to reduce sales or revenues for Ebay. Many of the products they are selling are available from US sellers. The other nations who are shipping direct to the US have had lots of warning. The Chinese are already shipping from US warehouses and have found schemes which are reducing their costs. That includes using Chinese USPS partnered carriers to reduce their shipping costs.
Not every seller being affected is passively accepting their demise.