Kim Batten, a physical therapist from Oakland, California, purchased a trench coat from a Dutch retailer earlier this year for $456, a price that was slightly over her budget.
But after the coat was shipped, UPS informed Ms. Batten via email that she would have to pay over $250 in customs fees to receive the coat. With shipping, the entire transaction came to well over $700.
“It ended up being the second most expensive item of clothing I’ve ever bought next to my wedding dress,” she said.
For decades, there were no tariffs on items like Ms. Batten's coat. But this year, President Trump closed a loophole that had allowed goods worth $800 or less to enter the United States duty-free. The rule, known as the de minimis exception, ended in May for items from China and in August for the rest of the world. Buyers are now having to pay tariffs for the first time, often in much higher amounts than expected.
“I’m definitely more wary of where I shop now,” Ms. Batten, 35, said.
Democrats and Republicans spoke out in favor of eliminating the exemption for low-value goods. They said it helped major sellers, particularly those from China, avoid tariffs and made it easier to smuggle fentanyl into the country. Other countries are now planning to abolish or tighten marginal exemptions.
Still, the suddenness with which the United States closed the gap created significant disruptions for sellers of all sizes, as well as express carriers like FedEx and UPS, postal networks, and American buyers.
“It was definitely a bit of whiplash,” said Clint Reid, chief executive of Zonos, a provider of software that helps sellers calculate and pay rates.
Before the policy change, an average of around four million de minimis packages entered the United States each day. The number of packages valued at $800 or less coming into the country is now much lower.
Since Aug. 29, when the loophole was closed to all countries, Customs and Border Protection has processed over 70 million shipments that would previously have been eligible for the exemption, a daily average inflow of over 800,000 packages, according to an agency spokesperson. The spokesman said the agency had “assessed over $400 million in tariffs” on the packages.
“The volumes of packages coming into the US continue to increase as exporters adapt to the new guidelines,” the spokesperson added.
Foreign sellers react differently to the new regulation.
Instead of shipping items individually from overseas, some foreign retailers have begun shipping their goods to the United States in bulk, paying tariffs at the border and distributing them to consumers from American warehouses. And some foreign sellers who continue to sell directly to buyers in the United States have also chosen to pay the tariffs themselves.
In both cases, sellers may increase prices to cover all or part of the duty, but American recipients would not be required to pay duty to receive the package.
However, some sellers choose not to pay the duties themselves but instead require their customers to do so. This is why buyers need to take a close look at the checkout process and look at the fine print on sellers' websites.
Some foreign retailers calculate the tariff amount at checkout, giving shoppers the opportunity to decide whether to complete the purchase. Ssense, an online boutique based in Montreal, discloses tariff amounts to customers this way.
One of the big surprises comes when sellers don't collect tariffs from buyers at the time of purchase – and don't say how much consumers might have to pay later.
Ms. Batten bought her coat in July from Rain Couture, an Amsterdam-based retailer whose website does not tell U.S. customers how much they will owe in customs duties. Rain Couture doesn't even indicate on its checkout page that duties may need to be paid. Instead, buyers must click through to other pages on Rain Couture's website to read that the obligations are their responsibility. Rain Couture did not respond to requests for comment.
To preserve her Chinese-made coat, Ms. Batten paid the customs duties to UPS. The customs payment corresponded to almost 60 percent of the coat's value. UPS did not respond to questions about how the duty payment came about. Clothing made in China may be subject to various tariffs, resulting in high customs payments.
Some sellers clearly state that duties may be payable, but do not specify the amount.
This can also surprise buyers.
Claudia Scholtz, 78, an avid weaver from Portland, Oregon, paid Jane Stafford Textiles, a Canadian seller, $158.36 for leg extensions, pieces of wood that lift a loom. Jane Stafford clearly warns American customers at checkout that they will most likely have to pay duties to UPS later.
UPS informed Ms. Scholtz that she would have to pay $333.50 in customs duties to receive the parts. Ms. Scholtz, a former purchasing manager, paid the duty but asked UPS to investigate whether an error had been made because the duty was more than twice the item amount. Elizabeth Pataky, operations manager at Jane Stafford Textiles, said the extensions “originated in the Netherlands”.
A UPS spokeswoman said the rate was calculated correctly “based on the shipper’s information.” When asked how UPS arrived at the tariff level, she did not answer.
Ms. Scholtz cares for her husband, who has vascular dementia, and she says she finds weaving meditative. “It’s like my therapy,” she said. Asked how she would approach online shopping now, Ms. Scholtz said, “I would be very careful not to choose a product that doesn't ship within the United States.”
Ms Pataky said Jane Stafford Textiles expects to move to a new software system in January that calculates, guarantees and collects duties at the checkout. She said it would be “extremely difficult” for Jane Stafford, a small business, to bear the cost of the tariffs.
Ms. Pataky said she believes UPS most likely made a mistake in charging such a high rate for the route extensions, adding: “We are often just as in the dark as our customers and spend a lot of administrative time helping them dispute or reverse unexpected charges.”
Packages can be sent not only to the United States using express services, but also via the international postal network, where, for example, Canada Post forwards a package to the US Postal Service.
Sellers using the postal network experienced the greatest disruption when the de minimis exemption ended. The U.S. Postal Service is unable to collect tariffs on a large scale, and foreign post offices have suspended shipments to the United States.
However, the situation improved after the United States allowed certain qualified companies to collect and pay tariffs on postal network shipments. Packages arriving by mail now require customs duties to be paid before entering the United States, preventing unpleasant surprises for American buyers.
Several foreign post offices, including in Britain, Canada and Ukraine, now allow shippers to pay duties, but the flow of postal packages into the United States has fallen sharply, said Mr. Reid of Zonos, one of the qualified companies that collects and pays duties on mail.
He said American buyers are not used to paying tariffs, so most foreign sellers appear to have opted to simply pay the tariffs themselves. But Mr Reid added: “Sellers try to factor it into the product price in some way.”