Postal Service Hikes Rates

Postage rates will increase for the first time in two years. On April seventeenth there will be a 1.47 percent race increase across the board based on a price cap calculated by the Independent Postal Rate Commission using Consumer Price Index Data.

The U.S. Postal Service announced that the cost of a stamp will remain at 44 cents, however, the rate for large packages including large envelopes, periodicals, parcels, international mail, advertisements and postcards will increase. It is important to note that Express Mail and Priority Mail prices will not be affected. USPS is trying to recoup a loss of over $6 billion over the course of last year and more than $400 million in November 2010 alone. They reportedly owe a total of 5.4 million dollars to retired workers alone.

USPS does not receive tax dollars and since the growth of Internet and email for correspondence service, they have seen a decline in the need for their services. Recently, they have cut over 100,000 jobs and various services trying to make up the deficit, but they are still in financial trouble.

USPS can raise rates as long as they do not exceed the inflation rate of 1.7%. Last year, the postal service requested permission to increase rates higher than that, but the Postal Regulatory Commission rejected that request. The Postal Service is hoping the rate increase will bring in at least $340 million for the remainder of their fiscal year ending on September 30. USPS says that the increases will likely raise $720 million over the course of a year or 12-month period.

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