Government affairs
Legislative Updates
Today, Reps. Kenny Marchant (R-TX), Ralph Abraham (R-LA), and Dennis Ross (R-FL) introduced H.R. 5524, a bill which would raise the rates for inbound international mail and packages and has been referred to the Committees on Oversight and Government Reform, Way and Means, and Foreign Affairs.
The bill’s authors assert that inbound rates are subsidized by USPS to the detriment of consumers and small businesses who pick up the cost through outbound and domestic shipping. They go on to claim that USPS lost $134.5 million on international mail in 2016 – an increase from $97.9 in 2015. The authors also claim that it is cheaper to send a package from China to the U.S. than it is to mail from within this country. The authors further assert that foreign merchants are “underselling our own companies with lower shipping costs.”
If passed, H.R. 5524 would require the Postal Service to set a preferential classification rate/fee for documents and good received from other countries. The bill would require the Postal Regulatory Commission (PRC) to review and allow for public comment in the rulemaking process. The PRC would then determine whether or not a change has been approved before periodically evaluating.
In a report by the Government Accountability Office (GAO) (link), the GAO asserted that while inbound dues do not cover the costs for USPS delivery, the losses are offset by outbound international dues. GAO also noted that the potential effects from an increase in inbound terminal rates could result in net-increases in cost to USPS and to U.S. consumers.
The Senate is considering a similar bill introduced by Sen. Bill Cassidy (R-LA) called the Ending Needless Delivery Subsidies Act of 2018 (S. 2638), which would force the Secretary of State negotiate the end to all foreign subsidies of international postal shipments by Jan. 1, 2021.
The fees this measure refers to are set by the U.N.'s Universal Postal Union (UPU), which governs the fees each member country pays for international mail. Its system is generally designed with wealthier countries paying more than poorer nations.
Sen. Cassidy makes a similar claim to his House colleagues that this system is to the detriment of American consumers, businesses, and USPS.
How likely either of these are to advance, though, remains unclear at best. What is clear that the desired impact of these bills is to remove the Postal Service from international mail, which has been a long-desired goal of private shippers. As such, NALC does not support either of these pieces of legislation and will continue to educate Members of Congress on the impact of such bills.
