With widespread anticipation of how President Donald Trump would handle the topic in the February 24 State of the Union Address, the fallout from the United States Supreme Court rejection of emergency power-based tariff authority cited by the White House continues with lawsuits seeking refunds, changes in new levy rates and a bill written by Democrats in the United States Senate addressing refunds of duties paid.
Payment of sweeping global duties imposed by the White House, citing the International Emergency Economic Powers Act (IEEPA), ended at midnight on February 24 after the Supreme Court ruled on February 20 that the President lacks such tariff authority under IEEPA.
The Supreme Court majority ruling rejecting Trump’s IEEPA tariffs didn’t address refunds, effectively punting that responsibility to lower courts. Observers said the refund process may fall to the U.S. Court of International Trade, and it could take years to process refund applications.
A statement from the U.S. Senate Finance Committee noted that senators Ron Wyden, D-Ore., Edward Markey, D-Mass., and Jeanne Shaheen, D-N.H., advanced legislation on February 24 to require full refunds of the administration tariffs struck down by the Supreme Court. According to the statement, the Trump administration has collected about $175 billion in tariff revenue. The Tariff Refund Act of 2026 would require the full refund, with interest, of those funds, including whatever duties have been liquidated already, a status that normally means the payments are locked, making them difficult to recover.
According to the bill, U.S. Customs and Border Protection must pay back liquidated and not-yet-liquidated funds while prioritizing payment of refunds to small businesses. The bill added that importers, wholesalers and larger businesses, including those that raised prices or passed on direct costs from the duties involved, should pass on the refunds to their customers, including small businesses and families impacted by the specific duties. The bill doesn’t specify how businesses should pass on the refunds, nor does it require that such action be taken.
In terms of processing the refunds, the bill stated that the commissioner should pay each importer subject to duties under the scuttled International Emergency Economic Powers Act authorization no later than 180 days after the bill’s enactment. However, the bill does not set a mechanism for doing so. Rather, the bill only states that, not later than 60 days after the enactment, the commissioner must issue guidance with respect to how to address claims for repayment.
The New York Federal Reserve recently reported results of a study indicating 90% of the Trump tariffs are paid by U.S. businesses and consumers. The Trump Administration disputed the survey results, saying the study was limited in its scope of assessing the impact of tariffs on pricing and supply shifts.
In the meantime, published reports indicate FedEx Corp. has filed a lawsuit in the U.S. Court of International Trade for a tariff refund. Costco, Revlon and Goodyear are among companies that filed such suits seeking refunds weeks before the February 20 Supreme Court decision.
Although President Trump pledged soon after the Supreme Court ruling that he would raise worldwide tariffs, with some exceptions for goods covered by negotiated trade deals, to 10% and then to 15%, it was reported Monday the White House set a new 10% global tariff rate under Section 122 of the Trade Act of 1974, which empowers the President to impose an import duty for 150 days.
Business continues to deal with the fallout from the Supreme Court decision. The conservative Wall Street Journal editorial board published an opinion piece entitled “The Unending Trump Tariff Mess,” emphasizing that the President, rather than calming the trade waters after the Supreme Court decision, is roiling them further by reacting with “fury” to the Supreme Court. The Wall Street Journal editorial board continues on to say that the President will end up hurting the economy and Republicans in Congress.
