April 10, 2018

Cassidy Introduces Legislation to End Taxpayer Subsidies of Mail from China, Other Foreign Countries

WASHINGTON— U.S. Senator Bill Cassidy, M.D. (R-LA), today introduced the Ending Needless Delivery Subsidies (ENDS) Act, legislation that would save U.S. taxpayers from having to subsidize international postal shipments from foreign countries to the United States.

“The current system costs American jobs at the expense of American taxpayers,” said Dr. Cassidy. “American taxpayers should not be subsidizing Chinese companies mailing items to the U.S., competing with our businesses.”

Currently, the United Nations’ Universal Postal Union (UPU) sets the fee each member country must pay for a foreign postal service to deliver international mail. The UPU uses a flawed system to determine shipping rates, resulting in the United States effectively subsidizing developing countries’ exports delivered by mail. A 2015 case study by the United States Postal Service’s (USPS) Office of Inspector General found that low cost items sent from China cost 27 percent less to ship than similar items sent within the United States.

Under the UPU’s system, while China, India and Brazil pay smaller fees, the U.S. Postal Service picks up the tab. A 2017 Government Accountability Office (GAO) report stated that “the rates for inbound international terminal dues mail does not cover [USPS’s] costs for delivering that mail in the United States. As a result, USPS’s net losses on this type of mail more than doubled between 2012 and 2016.”

The House Committee on Oversight and Government Reform held a hearing on the issue in 2015.

Cassidy’s bill requires the U.S. secretary of state to negotiate with the UPU to end all subsidies, and prohibits new agreements that provide foreign shipments preferential pricing if the same treatment is not given to U.S. packages.