A recent ruling by a federal court of appeals implies that President Trump has exceeded his authority with the imposition of extensive tariffs. American importers are now questioning if a refund on the over $150 billion in tariffs they have previously paid is forthcoming.

The Ruling on Trump’s Tariffs

The federal court decided that the Trump administration’s usage of the International Emergency Economic Powers Act (IEEPA)—which grants the president the power to regulate a range of economic transactions following a national emergency declaration—as a justification for these tariffs was illegitimate. This ruling supports a May decision by a federal trade court.

Despite this setback for Trump’s tariff agenda, the appeals court permitted the affected tariffs to remain until Oct. 14, opening the possibility for an elevation of the issue to the Supreme Court. As the nation’s highest court, it could potentially consider the case when the new session commences next month.

Will the Supreme Court Review the Tariff Case?

Whether the Supreme Court will review the case remains uncertain, given its historical tendency to refrain from commenting on similar topics. David Coale, a Texas-based appellate lawyer, suggests the administration may opt to change the legal justification for its tariffs rather than risking a court battle they might lose.

The Prospect of a Refund

Many American businesses are exploring ways to reclaim some of their funds, potentially involving bureaucratic procedures. The lawsuit parties in the recent court ruling have a strong argument for a refund, but the process for other businesses to get their money back remains ambiguous.

Customs and Border Protection’s (CBP) administrative structure provides one avenue for other parties to seek a refund, although it is likely to involve considerable red tape and potential litigation, according to Coale.

However, a Supreme Court ruling unfavorable for the Trump administration could result in automatic refunds for importers. If not, companies will likely engage experts to navigate this complex process. Mike Short, President of Global Freight Forwarding at C.H. Robinson, notes that the Supreme Court’s decision will ultimately dictate the possibilities for tariff refunds.

Despite the ongoing uncertainty, Trump’s IEEPA-based tariffs—apart from those placed on steel, aluminum, and copper—may face a significant challenge. Notably, this includes his “Liberation Day” tariffs that reached just under 50% for some countries.

If the court of appeals’ ruling is upheld and the tariffs are invalidated, the U.S. government could potentially lose out on significant revenue. The Congressional Budget Office recently forecasted that revenue from Trump’s escalated tariffs could reduce the federal deficit by $4 trillion over the next decade.

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