India has decided to completely suspend bookings of all categories of US-bound mail. The Department of Posts issued a notice on August 29, stating that “it has now been decided to completely suspend booking of all categories of mail, including letters, documents and gifts valued up to $100, destined to the USA.”
The department cited “the inability of carriers to transport US-bound mail, and undefined regulatory mechanisms” as reasons for the suspension.
Earlier in August, the Ministry of Communications noted that US-bound carriers had declined shipments because of uncertainty over new customs rules issued by American authorities.
The US administration on July 30 ordered that goods worth more than $100 would be subject to customs duties in America with effect from August 29. The earlier order had allowed letters, documents and gifts worth up to $100 to continue, but the new directive has now halted all categories of mail to the US.
The decision comes as Indian goods face 50 percent tariffs in the US—comprising 25 percent under President Donald Trump’s ‘reciprocal’ tariff policy and another 25 percent penalty imposed on India for continuing trade with Russia.
Following the new rules, shipments will be charged either ad valorem duty based on effective tariff rates under the International Emergency Economic Powers Act (IEEPA), or a flat duty of $80, $160 or $200 per item depending on the country’s tariff bracket.
Meanwhile, the US has ended tariff exemptions for low-value parcels. The US Customs and Border Protection agency confirmed that from Friday, normal duty rates apply to all packages valued under $800, irrespective of origin or transport mode.
Foreign postal agencies may either collect duties according to declared value or apply a flat rate derived from the tariff bracket of the origin country.
Countries with Trump-imposed duty rates below 16% (including Britain and the EU) face $80 per parcel.
Countries with rates between 16% and 25% (such as Indonesia and Vietnam) face $160.
Countries with rates above 25% (including Brazil, Canada, China and India) face $200.
The agency said the change expands the Trump administration’s cancellation of the de minimis exemption, which had already been scrapped for parcels from China and Hong Kong in May as part of efforts to block fentanyl shipments to the US.
The de minimis exemption, first introduced in 1938 at $5 for gift imports, was last raised from $200 to $800 in 2015 to support small businesses on e-commerce platforms.
US officials estimate the latest measures could add $10 billion annually to customs revenues.
(By arrangement with livemint.com)
