The Trump administration on Tuesday released a report that recommends the U.S. Postal Service (USPS) enact reforms that could raise shipping rates for certain packages, a move that could inflame tensions with Amazon and other online retailers.
The administration’s USPS task force says the changes are needed to bring in more revenue for the cash-strapped Postal Service, which reported $3.9 billion in losses in fiscal year 2018.
“Although the USPS does have pricing flexibility within its package delivery segment, packages have not been priced with profitability in mind,” reads an executive summary of the report. “The USPS should have the authority to charge market-based prices for both mail and package items that are not deemed ‘essential services.’” The report recommends that the USPS divide its mail and package shipments into essential and commercial service categories.
Senior administration officials say the Postal Service would be able to change package rates without an act of Congress. But such a move would likely require re-working negotiated service agreements with Amazon and other companies. Officials pushed back on the notion the proposal was aimed at Amazon, a company that President Trump has repeatedly criticized. “None of our findings or recommendations relate to any one customer or competitor of the Postal Service,” said one senior administration official, who requested anonymity to discuss the report before its release.
Once the Report is Officially released by the White House we will update this Report.