Post Office Won’t Hike Rates to Mail Holiday Packages

The United States Postal Service (USPS) has a little gift for consumers this year: It’s not adding a holiday surcharge on packages.

Last holiday season, the USPS temporarily raised rates from Oct. 2 through Jan. 22. It increased first-class package rates, for example, by 8.4 percent and Parcel Select Ground packages 4.2 percent.

This year, however, there will be no extra charges for the holiday season, making the post office more competitive with UPS and FedEx. UPS, for example, will be adding a $6.50 surcharge for packages over 50 pounds as well as packages with unusual sizes from Oct. 1 to Jan. 13. FedEx shipping rates will increase by an average of 5.9 percent from Oct. 2 to Jan. 14.

Long campaign to raise stamp prices

The USPS has raised stamp prices twice this year, from 60 cents for a Forever stamp to 66 cents — a 10 percent increase. Forever stamps, introduced in 2007, are always equivalent to the current price of a first-class stamp. Since 2011, virtually all first-class stamps sold are Forever stamps. If you had bought a Forever stamp in 2012 and paid 45 cents for it, you could still use the stamp to mail a first-class letter.

The Postal Service is also introducing USPS Ground Advantage for shipping packages in two to five business day across the continental U.S. It touts the new ground service as a more affordable option for shipping holiday packages.

A 2006 law generally capped postage increases in line with increases in the consumer price index (CPI), the government’s main measure of inflation. The same law, however, allowed the Postal Regulatory Commission to review the effects of the postage price cap, and in 2017, the commission ruled that the cap hurt USPS profitability. In November 2020, the commission issued new rules that gave the Postal Service more flexibility when it comes to rate increases.

The U.S. Post Office Department was established in 1792 as part of the federal government. In 1970, it was reorganized as the USPS, a separate agency, and generally receives no taxpayer money for operating expenses. The postage price hikes were a first step in a plan to reverse a projected $160 billion in operating losses over the next decade.

The USPS plans to hire 10,000 seasonal employees to handle the 2023 holiday rush. “We understand the importance of every single package and letter that is sent during the holidays,” Postmaster General Louis Dejoy said in a statement. “That is why we continue to adapt and execute on strategies to modernize and transform the Postal Service into the high performing organization the nation expects and deserves. I am confident in our ability to handle the peak season surge and deliver exceptional service to the American people during the holidays and beyond.”