Importers brace for $150 billion tariff refund fight if Trump loses at Supreme Court

Company executives, customs brokers, and trade lawyers are bracing for a Supreme Court ruling on the legality of President Donald Trump's sweeping global tariffs—and a potential fight over obtaining perhaps $150 billion in refunds from the US government for duties already paid by importers if he loses.

Anticipation that the court will strike down the tariffs Trump imposed under the International Emergency Economic Powers Act of 1977 rose after the November arguments in the case when conservative and liberal justices alike voiced skepticism about whether that law gave him the authority to levy the duties. 

The court is expected to issue rulings on Friday but, as is customary, has not said what case or cases will be acted upon. Some companies anticipate that even if the court invalidates Trump's tariffs, the Republican president will not make it easy for them to get refunds.

"It's not in the government's DNA to give back money. And Trump would not want to give back money," said Jim Estill, CEO of Danby Appliances, a Canadian company that sells small refrigerators, microwaves, and laundry equipment through big-box stores, including Home Depot. 

The products are made in China and other Asian countries targeted by the Trump tariffs. If Danby can get its $7 million back, Estill said he is also concerned Home Depot and its customers will want a cut.

"It's just going to be a dog's breakfast," Estill added, meaning a mess. Trump is the first president to invoke the International Emergency Economic Powers Act, or IEEPA, to impose tariffs. This law historically been used for imposing sanctions on US adversaries or freezing their assets.

His IEEPA-related tariffs generated $133.5 billion in estimated collections between February 4 and December 14, the date of the most recent data from US Customs and Border Protection, or CBP. The current total is estimated to be approaching $150 billion based on the continuation of the average daily collection rates from late September through mid-December, as calculated by Reuters.

While the move stops short of hopes by importers for a fully automatic refund process, "it does kind of signal that Customs is fully prepared to move forward with refunds if the Supreme Court does, in fact, rule that way," said Angela Lewis, global head of customs at freight forwarder and logistics firm Flexport.

A CBP spokesperson did not respond to questions regarding how the agency would handle a ruling against Trump's tariffs. The agency said in a statement that eliminating the use of paper checks for refunds would speed payments through its ACE electronic portal and reduce errors and fraud.