Big Tariff Refunds Are Coming. How Much And How Soon?

Earlier today I noted Supreme Court Strikes Trump’s Reciprocal Tariffs In 6-3 Vote

Since the Supreme Court made no ruling on refunds it will be up to the US Court of International Trade to decide when and how.

Expect refunds. That was also my prediction. Most didn’t, even those who expected the courts to smack this.

Tariff Ruling Kicks Off Messy Fight Over $170 Billion in Refunds

Bloomberg reports Tariff Ruling Kicks Off Messy Fight Over $170 Billion in Refunds

“The court says nothing today about whether, and if so how, the government should go about returning the billions of dollars that it has collected from importers,” Kavanaugh wrote. “But that process is likely to be a ‘mess,’ as was acknowledged” during the court’s oral arguments in November.
US Customs and Border Protection so far has collected an estimated $170 billion in tariffs imposed by Trump using the International Emergency Economic Powers Act, the law at the center of the case, as of Dec. 14.
The court ruled that using IEEPA to impose tariffs wasn’t lawful, but the justices didn’t address whether importers are entitled to refunds, leaving it to a lower court to sort out those issues. The litigation will return to the US Court of International Trade for the next round of legal wrangling.
While waiting for the justices to rule, more than 1,500 companies have filed their own tariff lawsuits in the trade court to put themselves in line for tariff refunds, according to a Bloomberg analysis.
The trade court in recent months has pressed the Justice Department for at least a hint of how it plans to handle the refund issue if it lost at the Supreme Court.
In written submissions, government lawyers have said that the administration won’t fight the court’s authority to order officials to recalculate tariffs, but left open the possibility that it might try to limit which importers are eligible.
The US trade court has experience managing a mass refund process. After the Supreme Court struck down a harbor maintenance tax on exporters in 1998, the court created a claims process. That fight involved approximately 4,000 cases and $750 million in taxes paid, according to court records and reports at the time.
The scale of Trump’s contested tariffs is far larger — by the end of 2025, the government told the trade court that more than 300,000 importers had paid the contested tariffs so far.
“For importers, it means that there is a refund potential,” said Ted Murphy, a partner at Sidley Austin LLP. What the refund process will be and how long it will take “is a big issue,” he added.
Some industries stand to receive a bigger share of the duties collected under IEEPA as of Dec. 14. According to an analysis from Bloomberg Economics, textiles, toys and food and beverages industries top the list of industries that import final goods, including wholesalers, retailers and manufacturers with factories outside the US. For those that import tariff-hit components needed to manufacture goods domestically, it’s machinery, electronics and autos that stand out.
“The construction industry—from its purchases of electrical equipment and appliances, possibly to be fitted in new buildings—also appears particularly exposed,” BE’s Nicole Gorton-Caratelli and Chris Kennedy wrote.
Firm size will also play a role in who sees the biggest refunds, they said. Because any refunds would go to the importers-of-record who paid the duties, larger companies that import goods themselves are more likely to receive refunds directly than smaller firms that buy from wholesale importers.
Customs brokers and lawyers are advising companies that the administration could make it difficult to obtain refunds, potentially requiring proof that they didn’t pass the cost on, or demanding extensive paperwork for each shipment. For now, importers are being told to at least have their import records in order for a refund push, even if they don’t know what it’ll look like yet.
CBP recently announced that starting Feb. 6, the US Treasury would no longer issue CBP refunds via paper check, instead moving to electronic payments.

It Doesn’t Have to Be Messy

Following Oral Arguments, I commented … ” I appreciate the logic of Gorsuch who stated that a refund is the traditional remedy for unlawfully imposed fees.“

But why should it be messy?

Trump’s Claim

Truth Social Link: The actual numbers that we would have to pay back if, for any reason, the Supreme Court were to rule against the United States of America on Tariffs, would be many Hundreds of Billions of Dollars, and that doesn’t include the amount of “payback” that Countries and Companies would require for the Investments they are making on building Plants, Factories, and Equipment, for the purpose of being able to avoid the payment of Tariffs. When these Investments are added, we are talking about Trillions of Dollars! It would be a complete mess, and almost impossible for our Country to pay. Anybody who says that it can be quickly and easily done would be making a false, inaccurate, or totally misunderstood answer to this very large and complex question. It may not be possible but, if it were, it would be Dollars that would be so large that it would take many years to figure out what number we are talking about and even, who, when, and where, to pay. Remember, when America shines brightly, the World shines brightly. In other words, if the Supreme Court rules against the United States of America on this National Security bonanza, WE’RE SCREWED!
PRESIDENT DONALD J. TRUMP

On January 13, I asked If the Supreme Court Rejects Trump’s Tariffs, How Big Might Refunds Be?

We have new numbers today, but let’s review my other comments.

Big Set of Trumpian Lies
The cumulative IEEPA total to date is 133.5 billion. [Bloomberg now estimates $170 billion]
Trump’s claim “that doesn’t include the amount of “payback” that Countries and Companies would require for the Investments they are making on building Plants, Factories, and Equipment” is nonsense.
Those are wildly exaggerated unsecured pledges and mostly rebutted by source. Importantly, those are private investments, not US Treasury receipts.
Nothing was collected and there would be zero rebates.
Trump’s statement “it would be Dollars that would be so large that it would take many years to figure out what number we are talking about and even, who, when, and where, to pay,” is a blatant lie.
The idea we are collecting tariffs and don’t even know how much is laughable. The numbers on my charts are published administration numbers.
Collected Money
On the assumption that customs knows who it collected money from, the process is simple. Rebate the IEEPA tariff money collected. The administration has details for every category, updated daily.
The administration’s bragging by category proves they are lying about the difficulty of rebates.
Of course, one cannot possibly underestimate the potential stupidity of this administration.
If the Administration insisted, it could do things on a receipt-by-receipt basis. Then the administration would have mountains of paperwork to deal with.

Simple Process

The Administration know IEEPA tariff money collected.
The Administration knows who it collected money from.
The Administration refunds the money it collected.

I truly fail to understand how this can be messy, unless the administration purposely tries to make it messy. But even then, the Trade Court should set the process.

It’s amusing that the administration now ponders how to rebate end customers. Wasn’t the administration’s premise that foreign companies paid the tariffs and companies would not pass on increases?

Regardless, there is no process to rebate end consumers and unless companies announce sales to make up for it, nothing can be done.

Comments of the Day

“It’s hard to imagine a ruling that cuts more deeply to the heart of Trump’s identity in public life — he has linked his presidency to the ability to use tariffs as a deal-making cudgel and bend other global powers to his will.”

“What should concern all of us is three court justices were willing to sign onto giving Trump a power the constitution says he doesn’t have.“

A Word About Lutnick

Trump’s Prediction Pre-Decision

“Our economy will go to hell”.

Whole Country Would be Bankrupt

Trump: “Everybody would be bankrupt. The whole country would be bankrupt.”

Thanks. I’ll make a couple of notes.

Amusing Trump Rants

Huge Decision

“He started ranting about the decision, not only calling it a disgrace, but also attacking the courts at one point, saying: ‘these f*cking courts’”

“Not only is so much of his economic agenda based on these tariffs. So much of his foreign policy is based on these tariffs. He used tariffs as leverage in almost every meeting around the world.”

Note: In light of the ruling, Trump says “Everybody is bankrupt.”

“The whole county is bankrupt.”