FTA MEDIA RELEASE
"The writing was on the wall as early as last year, when in the lead-up to the presidential election Donald Trump flagged that, if elected, he would impose tariffs — and it was always likely this would extend to e-commerce goods. What was unknown until recently were the finer details and technical specifications, leaving incredibly short implementation timeframes. While some logistics providers anticipated and prepared for the changes, postal authorities globally have been caught short, with insufficient time to adapt. Australia Post is expected to resume operations soon once the technical requirements are met.
While the likes of FedEx, UPS and our freight forwarding members specialising in e-commerce have adapted to the new regulations, the bigger issue is the impact of tariffs on trading models. By applying tariffs at the retail sale price rather than the wholesale or manufactured cost, the US Government's removal of the de minimis threshold strips away the cost advantage of low-value cross-border transactions that previously entered duty-free.
This will inevitably force many retailers to pivot from direct-to-consumer e-commerce into more conventional logistics models — buying in bulk, holding stock in US warehouses, and fulfilling orders domestically. Under this model, tariffs apply at the lower manufactured cost instead of the higher consumer sale price. Large retailers will be able to adapt and prosper under this new environment. In contrast, even once Australia Post resumes operations, the policy will have devastating impacts on smaller retailers and manufacturers that previously relied on the benefits of de minimis arrangements.
While designed to address revenue leakage and strengthen enforcement, the measure risks higher costs and complexity across global supply chains. For Australian traders, it highlights the urgent need for modernised border systems and smarter facilitation measures to manage compliance efficiently while maintaining competitiveness.
Freight & Trade Alliance (FTA) will continue to engage with government and industry to ensure lessons from the US are considered in shaping Australia's border and biosecurity policy." |
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