US Tariff Refunds in Jeopardy as Trump Administration Plans to Appeal Order for Full Refunds

(CNA New York 2nd Combined Foreign News) After the US Supreme Court ruled that President Trump does not have the constitutional authority to impose higher tariffs on imports from nearly all countries, companies have begun receiving tariff refunds. However, the refund process may face disruption. The Trump administration has indicated it will appeal a federal judge's order that allows all businesses that paid the invalidated tariffs to apply for refunds, not just those that filed lawsuits.

According to the Associated Press, the refund process managed by US Customs and Border Protection (CBP) was proceeding smoothly before the Department of Justice notified the court of its intent to appeal. CBP data shows the first successful applicants received refunds on May 12, about three weeks after importers and customs brokers began submitting applications.

Court documents filed by CBP this week indicate that as of May 22, it had processed $85 billion in refund applications, more than half of the $166 billion CBP estimates the government owes businesses. It has already requested $20.6 billion from the Treasury Department for disbursement.

The Trump administration revealed its plan to appeal while opposing Judge Richard K. Eaton's order requiring CBP Commissioner Rodney Scott to testify in person at the US Court of International Trade on June 9.

Judge Eaton stated he wants to understand how long it will take to refund the 330,000 potentially eligible importers and whether the court should require the government to expedite the process.

Justice Department lawyers requested that a deputy appear instead of Scott, arguing that as a high-ranking presidential appointee, the CBP Commissioner should not be compelled to testify. They also argued that Judge Eaton exceeded his authority by ruling that the Supreme Court decision applies to "all registered importers" and grants them refund rights.

"For this reason, the defendants will appeal the court's blanket injunction," the Justice Department stated in its filing, while noting that CBP will continue to process refund applications for litigating companies as quickly as possible in a phased manner.

Judge Eaton responded that he needs to hear directly from Scott to confirm whether the government is willing to refund all tariffs collected from April 2025, when Trump implemented so-called "reciprocal tariffs," through the end of February this year, when the Supreme Court ruled.

He emphasized: "There is no dispute that the remedy for this illegal collection is for the US government to refund all illegally collected tariffs."

Currently, over 1,000 companies have filed lawsuits with the International Trade Court seeking refunds of tariff payments. However, it remains unclear how many importers who paid tariffs did not participate in the litigation and whether they would still receive refunds if the government's appeal succeeds.

Ryan Majerus, a partner at international trade law firm King & Spalding, noted that non-litigants likely represent only a portion of the total.

He said the appeal may only affect imports that remained in the US for 314 days, the period during which CBP makes formal determinations of taxes owed.

Some large retailers have indicated plans to use tariff refunds to lower prices.

Walmart CFO John David Rainey said the company would reduce prices on some items even though the refund amount represents less than 0.5% of its annual US sales.

Costco CEO Ron Vachris also stated the company intends to return to consumers the tariff costs previously passed on to members. (Editor: Xu Ruicheng) 1150603