*

Removal of tariff exemption to disrupt e-commerce, raise

costs,

analysts say

*

Customs agency collecting duties on all global parcel

imports

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Many postal services suspended shipments of parcels to US

*

Disruptions similar to February's not yet seen, logistics

expert

says

(Rewrites first paragraph, sdds statement from US customs

chief, paragraphs 5-6, comments from logistics expert, paragraph

15)

By David Lawder and Andrea Shalal

WASHINGTON, Aug 29 (Reuters) - The U.S. ended tariff

exemptions for parcel imports on Friday without the logistical

hiccups that dogged prior attempts, while consumers, e-commerce

companies and small businesses using online marketplaces braced

for cost increases and supply chain disruptions.

The U.S. Customs and Border Protection agency began

collecting normal duty rates on all package shipments valued

under $800, regardless of value, country of origin, or mode of

transportation.

For the first six months, importers can opt to pay a

flat-rate duty of $80 to $200 per package shipped from foreign

postal agencies.

The change broadens the Trump administration's cancellation

of the de minimis exemption, already in place for packages from

China and Hong Kong since May as part of an effort to halt

shipments of fentanyl and its precursor chemicals into the U.S.

The customs agency's commissioner, Rodney Scott, said it was

ready to enforce the new duty requirements.

"For too long, this loophole handed criminal networks a free

pass to flood America with fentanyl, fake goods, and illegal

shipments. Those days are over."

Trump administration officials said the change could boost

U.S. customs revenues by $10 billion annually.

The de minimis exemption has been in place since 1938,

starting at $5 for gift imports, and was raised from $200 to

$800 in 2015 to foster small business growth on e-commerce

marketplaces.

Direct shipments from China surged after President Donald

Trump raised tariffs on Chinese goods during his first term,

creating a new direct-to-consumer business model for e-commerce

firms such as Shein and Temu.

The National Coalition of Textile Organizations hailed a

"historic win" for U.S. manufacturing following the closing of a

loophole that allowed foreign fast-fashion firms to avoid

tariffs and import apparel sometimes made with forced labor,

undercutting American jobs.

"The administration's executive action closes this channel

and delivers long overdue relief to the U.S. textile industry

and its workers," the group said.

The customs agency has estimated that the number of packages

claiming the de minimis exemption jumped nearly 10-fold from 139

million in fiscal 2015 to 1.36 billion in fiscal 2024 - a rate

of 4 million per day.

More than 25 foreign postal services suspended mail to the

U.S. in the run-up to the de minimis deadline, helping the U.S.

to avoid a repeat of the chaotic package pile-up that forced the

Trump administration to pull back on its first attempt at ending

the de minimis exemption for China in February.

"I'm not hearing of any huge slowdowns at any of the

ports right now, but it's still early," said Bernard Hart, vice

president of customs and trade at logistics provider Flexport.

"We do believe that industry had enough time to react to this

and to move inventory around."

The customs agency said 95% of all de minimis shipments are

handled by general cargo carriers or express shippers such as

FedEx ( FDX ), UPS and DHL, which had already

adapted to the China changes. Britain's Royal Mail resumed

shipments on Thursday.

European postal groups including Germany's DHL and

Norway's Posten Bring on Friday were seeking ways to handle the

new fees and extra paperwork after suspending certain shipments.

HIGHER COSTS, MORE PAPERWORK

Retail and trade analysts say the end of de minimis is

likely to raise prices for many goods sold through e-commerce

companies, as those that previously avoided tariffs because of

the exemption become subject to duties. This may put such firms

on a par with costs for more established retailers like Walmart ( WMT )

that tend to import merchandise in bulk containers that

are subject to tariffs.

It is also likely to curb trade on peer-to-peer platforms

such as eBay ( EBAY ) and Etsy ( ETSY ), which are used by small

businesses to sell secondhand, vintage or handmade items.

The customs agency has collected more than $492 million in

additional duties on packages shipped from China and Hong Kong

since their exemptions were eliminated on May 2, another Trump

administration official said.

Foreign postal agencies can opt to collect and process the

duties based on the value of the package contents, or they can

collect a flat tax calculated from the tariff rate in effect for

the country of origin.

Based on the agency's guidance issued on Thursday, parcels

would be charged $80 from countries with Trump-imposed duty

rates below 16%, such as Britain and the European Union; $160

from countries between 16% and 25%, such as Indonesia and

Vietnam; and, $200 from countries above 25%, including Brazil,

Canada, China and India.