The U.S. Court of International Trade (CIT) on March 4 issued an order directing U.S. Customs and Border Protection (CBP) to begin refunding more than $130 billion collected over the past year under the IEEPA tariffs that were vacated by the Supreme Court last month. More than 300,000 American companies — two-thirds of which are small businesses — are owed refunds with interest in the wake of the ruling.
Efficient and Orderly: That same day, the U.S. Chamber of Commerce and the Consumer Technology Association (CTA) filed an amicus brief in the central suit before the CIT that will address how the refunds are to be administered. The brief argues that an efficient, orderly process to deliver refunds is in the best interest of all parties—the administration, the courts, and American businesses. U.S. Chamber Executive Vice President and Chief Policy Officer Neil Bradley commented:
“As a matter of law, it is now settled that IEEPA tariffs were collected unlawfully. On behalf of the hundreds of thousands of businesses, especially
small businesses, that are now owed refunds, the Chamber and CTA are asking the court to establish an efficient, orderly process to deliver refunds en masse.”
The CIT order directs CBP to liquidate all unliquidated entries “without regard to IEEPA duties.” For entries that have been liquidated, the CIT ordered CBP to reliquidate them also “without regard to IEEPA duties.”
“The Age of Computers.” On the broader process, Judge Richard Eaton of the CIT stated:
“Customs already has in place the policies and procedures necessary to determine the refund… and to make the refund. I believe that there will be no chaos associated with the provision of these refunds, and that it will not result in a mess.”
Refunds are Common: To that point, the amicus brief provides detailed examples of how tariff refunds have been delivered in the past. Examples include refunds after retroactive reauthorization of the Generalized System of Preferences, the Harbor Maintenance Fee invalidated in 1998, and even as the Trump administration negotiated “Agreements on Reciprocal Trade” that retroactively lowered tariff rates and afforded importers refunds on several occasions last year.
New Tariff, New Challenge: In a separate development, Democratic attorneys general from 24 states filed a lawsuit challenging the Section 122 tariffs the Trump administration began collecting on February 24 when collections of IEEPA duties were halted. Section 122 of the Trade Act of 1974 allows the executive to impose a uniform tariff of up to 15% for as long as 150 days to address a “fundamental international payments problem.”
While the duties are being collected at a 10% rate, Treasury Secretary Scott Bessent on March 4 echoed earlier comments by President Trump that the administration is preparing to raise the rate to 15%. However, doing so will mean the U.S. is raising its tariff above limits agreed in trade deals struck last year with the EU, U.K., Japan, Korea, and others. For rival perspectives on the legality of the Section 122 tariffs, see commentary by Bryan Riley of the National Taxpayers Union and separately by Brad Setser of the Council on Foreign Relations.
For further information, please contact Senior Vice President and Head of International John Murphy (jmurphy@uschamber.com) or Executive Director for International Policy Isabelle Icso (iicso@uschamber.com).