President Trump calls SCOTUS ruling on tariffs ‘shameful’
The SCOTUS tariff ruling could signal that the court may reverse some of President Trump’s other executive orders, including birthright citizenship.
- The US government will begin a new system to refund up to $166 billion in tariffs that the Supreme Court has ruled are illegal.
- Importers are concerned that the new online refund portal could crash or experience technical glitches due to high demand.
- Many companies, including toy makers and manufacturers, are preparing to claim millions of dollars in refunds.
- The system is designed to refund the importer who paid the duty, rather than the end consumer, who may have paid a higher price.
Jay Foreman said he is “ready to go” on April 20 for a new system to refund up to $166 billion in illegally collected tariffs by the U.S. government, but he and many other importers are realistic that a lot can still go wrong.
“We have to worry about what they might do to disrupt things,” said the CEO of Basic Fun, a toy maker that sells Tonka Trucks, Care Bears and K’Nex construction toys.
The refund scheme is the latest development in a protracted battle over tariffs collected over the past year as part of President Donald Trump’s efforts to rebuild trade relations with nearly every country on earth. The ever-changing tariffs have disrupted global business, as companies scramble to change supply chains to avoid tariffs and figure out who will ultimately pay the taxes.
In February, the Supreme Court struck down the tariffs President Trump had sought under the National Emergencies Act, handing him a crushing defeat.
Customs and Border Protection said in an April 14 court filing that it has completed early development of the refund system, known as CAPE. The system consolidates refunds, allowing importers to receive one electronic payment with interest where applicable, rather than processing refunds for each entry. Critics of President Trump’s tariffs had called for streamlining the process.
A CBP spokesperson said the agency has established a system to “efficiently process refunds to importers and intermediaries who paid duties in accordance with court orders.”
As of April 9, about 56,497 importers had completed the necessary procedures to receive electronic refunds, amounting to $127 billion, more than three-quarters of the total amount eligible for refunds, according to customs officials. More than 330,000 importers paid the tariffs on 53 million imported goods, according to court filings.
Matt Field, chief financial officer of heavy-duty truck manufacturer Oshkosh, is one of them. The Wisconsin-based manufacturer did not disclose how much it paid in emergency tariffs, but Field said it was a “significant” amount. “I’m a CFO, so I’m chasing every dollar,” he said.
Mr Field said he would be prepared to apply for a refund as soon as customs offices open, but may wait until “the system settles down.”
Importers interviewed by Reuters said they were concerned about the durability of the new application system, at least in the early stages, as thousands of people quickly uploaded applications.
“It’s not like tickets are going to go on sale for Taylor Swift,” said Foreman, CEO of Basic Fan, which is seeking a $7 million refund, but with so many companies seeking refunds at the same time, “we don’t know if the portal will crash.”
“There are wrinkles.”
There are many potential logistical hiccups. “It’s nice to get that money back,” said Jason Chan, CEO of Hunter, a U.S. toy maker with factories in China, but added, “It seems like the government is trying to make it difficult.”
Cheung pointed out that registration requires entering bank account information, even though the government already has bank account information for customs payments. Also, the company name must be accurate. “It took five tries to register because of small differences like ‘company’ and ‘collaborative’,” Cheung said.
Still, he said, “we’re very used to filling out forms” and have “no concerns” about whether the refund will ultimately be successful.
That sentiment was echoed by Rick Waldenberg, CEO of educational toy maker Learning Resources, one of the lead plaintiffs in the lawsuit that led to the tariffs being repealed.
“Of course there are wrinkles, but I’m glad to see the government do the right thing,” Woldenberg said. The company is seeking more than $10 million.
The problem extends beyond U.S. borders because any corporation that paid taxes can claim a refund. German electric fan maker EBM-Papst told Reuters it was already registered on the portal.
However, the system “is a new feature created by Customs, so it remains to be seen how well the system will actually handle batch processing of refund claims,” said a spokesperson for the Murfingen, Germany-based company.
Jim Estill, CEO of Danby Appliances, said Monday that the only preparation needed is access to all customs forms. “The information is very simple in our system, but we have already engaged a consultant (PWC) to assist us with this,” he said in an email.
Companies preparing the lawsuit said they were concerned that last-minute legal action by the Trump administration could also delay the process. Customs has until early May to appeal the International Trade Court’s order to create a customs refund portal.
After a year of U.S. consumers enduring tariff-driven price hikes, the question of who gets a refund has become a political issue. The system is set up to refund money to the importer of record rather than the ultimate end user who paid a higher product price as a result.
At a Congressional budget hearing on April 16, U.S. Trade Representative Jamison Greer, the architect of the tariffs struck down by the high court and the new import taxes the administration is rushing to replace them with, was asked whether the administration had any plans for rebates to households.
Greer said the attorney general of a Democratic-led state that filed one of the cases decided by the Supreme Court “required that the money be returned to the companies.” “Democratic attorneys general have asked for this, and they are getting what they asked for.”
(Reporting by Timothy Aeppel, Nicholas P. Brown and Christoph Steitz; Additional reporting by Tom Hals; Editing by Daniel Burns and Anna Driver)
