The Supreme Court on Friday overturned the centerpiece of President Donald Trump’s tariff plans, ruling the federal government illegally collected over $133 billion in taxes from American businesses.
Now comes the battle over refunds for tariffs paid, which Trump on Friday predicted could take years.
“I guess it has to get litigated for the next two years,” he said at a White House press conference, while blasting the ruling as “terrible” and “defective.”
One reason: Over 1,000 companies have filed lawsuits to claw back money from the government if the Supreme Court overturned Trump’s tariffs justified by the International Emergency Economic Powers Act.
In his dissenting opinion, Justice Brett Kavanaugh also predicted the process could become a “mess,” citing refund requests tallying “billions of dollars to importers,” even as some importers have already passed those costs to consumers.
Here are all your questions about tariff refunds, answered by experts.
Alright, who do I ask to get a refund?
Typically, the refund process would be handled by Customs and Border Protection, which collected the tariffs in the first place.
In order for that to happen, the Trump administration would need to establish a process for handling refund requests. The White House, which didn’t return Business Insider’s request for comment, has yet to signal plans to do this, said Rachel Brewster, a professor of international trade at Duke Law School.
Without a formal process in place, claims will be litigated in the Court of International Trade, which will order CPB to issue refunds to specific companies, Brewster said.
OK, so how will the court handle the process?
In the past, the Court of International Trade has ordered refunds when it has found particular taxes to be invalid — albeit on a smaller scale, according to Daniel Mach, a commercial litigator at Bryan Cave.
It’ll likely turn to the process that followed a 1998 Supreme Court decision to overturn a harbor maintenance tax, which also resulted in refunds, Mach said.
“It’s been a while,” Mach said. “Everyone’s going to be kind of figuring out the ropes as they go. But at the end of the day, it’s not an unsolvable problem.”
Given the number of claims, the Court of International Trade is likely to appoint an administrator or special master to consider each of them, rather than handling the lawsuits piecemeal, Mach said.
Groups that advocated for the Supreme Court to overturn the IEEPA tariffs have urged the Court of International Trade to develop a smooth process for refunds.
“The refunds will serve as an economic boost and allow companies to reinvest in their operations, their employees and their customers,” said David French, an executive at the National Retail Federation, in a statement.
OK, that sounds messy. How long will it take to get a refund?
The whole refund process — whether through CPB or through a class-action or administrative processes in court — could take up to two years, according to Brewster.
Have a lot of companies asked for refunds?
Yes! The cases that went to the Supreme Court were groups of small companies, including a wine importer and an educational toy retailer. But several massive corporations, including Toyota and Costco, have also filed refund lawsuits.
What about me? My Shein order was more expensive than expected.
You can try to get a refund for personal orders hit by tariffs, but it’ll be complicated.
In asking CPB or a court for a refund, you’ll have to distinguish tariffs you paid pursuant to IEEPA, which were overturned, and the tariffs justified by other laws, which remain on the books.
Individual lawsuits for IEEPA tariffs on individual retailer orders, like from Temu and Shein, likely won’t be worthwhile. The legal fees would likely exceed any potential refund. But it’s possible that some enterprising litigators would put together a class-action lawsuit to make it worthwhile, Brewster predicted.
“It was an illegally imposed tax,” she said. “So in theory, everyone is entitled to a refund.”
