Tariff Rulings Invalidated; Trump Administration Begins Accepting Corporate Refund Applications

The U.S. government officially launched the tariff refund application mechanism on April 20, beginning to accept applications from businesses seeking reimbursement for import tariffs previously imposed by President Donald Trump under emergency powers—but later ruled illegal by the courts. The total amount expected to be refunded is estimated at over $166 billion, making it one of the largest tariff refund actions in U.S. history.

This refund program is being executed by the U.S. Customs and Border Protection (CBP). Businesses and customs brokers can now submit applications starting Monday morning at 8 a.m. through a newly established online system, with claims processed in phases. Officials stated that the initial system can handle approximately 63% of affected customs entries, with the remainder gradually incorporated in subsequent stages.

The refund initiative stems from a February ruling by the U.S. Supreme Court, which decided 6 to 3 that the Trump administration’s use of the 1977 International Emergency Economic Powers Act (IEEPA) to impose tariffs on goods from nearly all countries exceeded constitutional authority. Chief Justice John Roberts, writing for the majority, emphasized that the law did not grant the president such broad taxing powers, noting that tariffs fall within Congress’s exclusive domain. Additionally, two justices appointed by Trump—Neil Gorsuch and Amy Coney Barrett—joined the majority opinion.

Although the Supreme Court’s decision did not directly specify refund procedures, the U.S. Court of International Trade subsequently ruled that affected businesses have the right to recover both the duties paid and accrued interest, prompting the executive branch to initiate the refund process.

According to court documents, as of early this year, approximately 330,000 importers had paid related tariffs on over 53 million shipments, totaling about $166 billion. CBP noted that this scale is “unprecedented,” and the existing systems were never designed to handle such a massive refund demand. As a result, a completely new infrastructure must be built from scratch, with some processes still requiring manual intervention.

CBP explained that companies must submit what is known as a "CAPE declaration," detailing all imported items subject to tariffs along with their respective document numbers. Once approved, the system will recalculate the correct tax amount and initiate the refund. Most cases are expected to be completed within 60 to 90 days after approval, though complex cases may take longer.

However, the initial phase of refunds is limited to customs declarations that have not yet been finalized or were finalized less than 80 days ago. Shipments still under anti-dumping investigations, legal disputes, or other customs proceedings are temporarily ineligible for refunds.

Furthermore, companies must first register in the electronic payment system and provide bank account information before they can receive refunds. By mid-April, around 56,500 importers had completed registration, covering an estimated refundable amount of $127 billion—but a significant number of businesses remain incomplete with necessary procedures.

At the corporate level, the refund applications have drawn intense attention. Brad Jackson, co-founder of a cigar importer based in Minnesota, told ABC News that his company paid roughly $34,000 in tariffs last year. To avoid losing customers, most of the cost was absorbed internally. He said he began gathering documentation immediately upon hearing of the system launch: “My biggest concern is processing time—if refunds take several months, the benefit to cash flow will be minimal.”

So far, more than 3,000 companies have filed lawsuits against the government demanding tariff refunds, including major corporations such as Skechers, Revlon, Toyota, Nintendo of America, FedEx, and Costco. Some firms even filed suits prior to the Supreme Court’s ruling, indicating strong confidence in a favorable outcome.

However, refunds are limited to businesses that actually paid the tariffs and do not directly benefit general consumers. Over recent years, most tariff costs have already been passed on to product prices—from electronics to clothing. Whether consumers ultimately benefit depends on whether companies choose to pass the refunds back through lower prices.

FedEx has stated it will return received refunds to customers who originally bore the tariff burden. Costco hinted that if it receives refunds, it might reduce product prices—but some consumers have already filed class-action lawsuits, questioning the vagueness of these promises.

U.S. Treasury Secretary Scott Bessent previously warned that the overall refund process “could become chaotic” and might extend for months or even years. Trump himself said related litigation could drag on for two to five years. Yet, just months after the Supreme Court’s decision, the government has launched the refund system—proceeding faster than many anticipated.

Source: rfi

Original article: toutiao.com/article/1863032866513931/

Disclaimer: This article reflects the personal views of the author