The proposed rate hike underscores the deep financial hole the Postal Service is currently in, with a $7 billion deficit projected for next year.
Complicating the situation is the deep decline in mail being sent. In 2009, the amount of mail being sent declined 12.7 percent. Businesses are cutting back on their mailings and more and more people are communicating and paying bills via the Internet.
The Postal Service already announced a 50,000 job-reduction earlier this year.
Rates on packages and magazines are also expected to increase. The combined new revenue would be around $3 billion annually.
The Postal Regulatory Commission, which must approve the increase, had 90 days to issue a decision.
Affordable Mail Alliance: Proposed Stamp Price Increase is a "Tax" Hike
Just hours after the United States Postal Service announced that it would seek a number of rate increases, opponents of the proposal created the Affordable Mail Alliance in an attempt to fight the plan.
According to their website, the newly formed organization is a coalition of charities, small businesses and customers who use the post office everyday - all of whom are "customers that will suffer if USPS successfully raises rates again."
In a statement released today, the group's spokesman Tony Conway said, "This proposed rate increase amounts to another tax imposed on Americans at a time when the economy can least afford it." He added: "Consumers everywhere will pay more for the letters and packages they need to send; struggling businesses - large and small - will suffer and even more jobs will be lost."