WASHINGTON (AP) — The Supreme Court recently overturned President Trump’s significant tariffs, leaving a big question: what will happen to the $133 billion collected from import taxes now deemed illegal?
Many companies are eager for refunds, but the path to getting that money back could be messy. Trade lawyer Joyce Adetutu anticipates a rocky process ahead. “It’s going to be a bumpy ride for a while,” she said.
The U.S. Customs and Border Protection, along with specialized courts, will likely handle the refund process. But Adetutu warns that navigating this system will be challenging. “The amount of money is substantial. The courts are going to have a hard time,” she added.
In a recent 6-3 ruling, the Court found that Trump’s use of the 1977 International Emergency Economic Powers Act (IEEPA) to impose tariffs was invalid. This decision marks the first major setback of Trump’s second-term agenda. Notably, two justices he appointed supported the majority ruling.
Trump’s tariffs affected nearly every country and resulted in billions collected by the customs agency. While businesses may receive refunds, consumers likely won’t see any relief. The higher prices were passed on to them, making it tough to trace costs back to specific tariffs.
Justice Brett Kavanaugh expressed concern about the lack of clarity on how refunds will be managed. He warned that the process might become a considerable “mess.” Trump himself predicted ongoing legal battles, claiming the court’s decision could lead to years of litigation.
Some experts believe that refunds could help ease inflation and stimulate spending. However, the overall impact might be limited, as significant tariffs remain in place for various sectors. Experts from TD Securities estimate it could take 12 to 18 months for the refund process to get underway.
The customs agency does have protocols for refunding duties when there’s proof of an error. This system might be adapted for the IEEPA tariffs, according to trade lawyer Dave Townsend. Historically, courts have established refund systems for similar situations, but never on such a large scale.
Ryan Majerus, a former U.S. trade official, highlighted that the government might implement a streamlined procedure for refund applications, possibly even a dedicated website for importers.
However, trade lawyer Alexis Early cautioned that the government might make the process difficult, potentially forcing importers to seek refunds through litigation. Companies like Costco and Revlon have already filed lawsuits to claim their refunds.
There may be further legal disputes as manufacturers could seek compensation for higher raw material costs caused by the tariffs. “We could see years of ongoing litigation,” Early noted.
Importantly, consumers may not benefit from the refunds. The higher prices they faced are tough to link directly to specific tariffs. Legal fees could outweigh potential gains, Thus, pursuing refunds might not be the best option.
Illinois Governor JB Pritzker, a critic of Trump, has demanded refunds for families in his state, claiming the tariffs cost each household around $1,700. Meanwhile, Nevada Treasurer Zach Conine is requesting $2.1 billion in compensation for Nevada families.
In conclusion, while the Supreme Court’s ruling raises many questions about refunds from the abolished tariffs, the process ahead is uncertain and complicated. With ongoing legal issues and significant financial stakes, the next steps will be closely watched.
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Donald Trump, J.B. Pritzker, Brett Kavanaugh, Courts, International trade, Economic policy, Supreme Court of the United States, Government policy, General news, Tariffs and global trade, Ryan Majerus, Zach Conine, Business, Joyce Adetutu, U.S. news, Alexis Early, Dave Townsend, District of Columbia, Illinois, Nevada, Politics, Costco Wholesale Corp., Amy Coney Barrett, Lawsuits, U.S. News
