WASHINGTON — The nation’s highest court delivered a decisive blow to President Donald Trump’s expansive tariff program on Friday, but justices sidestepped a massive financial puzzle: how to handle the $133 billion in import duties already collected under policies now deemed illegal.
Businesses across the country are already positioning themselves for potential refunds, though experts warn the path ahead will be complicated and messy.
Trade attorneys expect importers will eventually recover their money, but the process won’t be smooth. “It’s going to be a bumpy ride for awhile,” said Joyce Adetutu, a trade attorney with Vinson & Elkins law firm.
According to legal experts at Clark Hill, the refund process will likely involve multiple entities including U.S. Customs and Border Protection, New York’s specialized Court of International Trade, and various federal courts.
“The amount of money is substantial,” Adetutu noted. “The courts are going to have a hard time. Importers are going to have a hard time.”
However, she emphasized that given the Supreme Court’s strong rejection of Trump’s tariff authority, “it’s going to be really difficult not to have some sort of refund option.”
The court’s 6-3 decision Friday determined that Trump’s use of emergency powers legislation to implement the tariffs was invalid. Notably, two Trump-appointed justices voted with the majority to overturn this major component of his second-term economic agenda.
The contested tariffs were substantial levies Trump placed on nearly all nations worldwide last year, citing the 1977 International Emergency Economic Powers Act (IEEPA). The Supreme Court determined this law doesn’t grant presidential authority to impose import taxes, which constitutionally belongs to Congress.
Government customs officials have already gathered $133 billion through IEEPA tariffs by mid-December. However, everyday consumers shouldn’t expect direct compensation for higher prices they paid when businesses transferred tariff costs to customers; those refunds would more likely benefit the importing companies directly.
In his dissenting opinion, Justice Brett Kavanaugh criticized his fellow justices for avoiding the refund question entirely: “The Court says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers.”
Using language from Justice Amy Coney Barrett’s comments during November oral arguments, Kavanaugh predicted the refund process would likely become a “mess.”
Speaking to reporters Friday, Trump expressed frustration with the court’s ruling and said he felt “absolutely ashamed” of justices who voted against his tariff program. “I guess it has to get litigated for the next two years,” Trump stated. “We’ll end up being in court for the next five years.”
Eliminating the IEEPA tariffs might benefit the economy by reducing inflation pressures. Tariff refunds could boost consumer spending and economic growth, though economists expect modest overall impact.
Many nations still face significant U.S. tariffs on particular industries, and Trump plans to implement replacement levies through alternative legal mechanisms. Any refunds that do materialize will take considerable time to distribute — TD Securities estimates 12 to 18 months.
U.S. customs already maintains procedures for refunding duties when importers demonstrate administrative errors occurred. Trade attorney Dave Townsend from Dorsey & Whitney suggests the agency might expand this existing framework to handle IEEPA tariff refunds.
Courts have previously established refund systems in trade disputes. During the 1990s, after courts declared a harbor maintenance fee on exports unconstitutional, they created an application process for exporters to recover their payments.
However, customs officials and courts have never confronted anything approaching this scale — thousands of importers seeking tens of billions in refunds simultaneously.
“Just because the process is difficult to administer doesn’t mean the government has the right to hold on to fees that were collected unlawfully,” explained Alexis Early, a trade lawyer with Bryan Cave Leighton Paisner.
Ryan Majerus, who works at King & Spalding and previously served as a federal trade official, said it remains unclear how authorities will manage such enormous refund demands. The government might streamline operations, potentially creating dedicated online portals for refund claims.
Yet Adetutu cautions that “the government is well-positioned to make this as difficult as possible for importers. I can see a world where they push as much responsibility as possible onto the importer” — potentially requiring court action to secure refunds.
Several major corporations, including Costco, Revlon, and food producer Bumble Bee Foods, had already filed refund lawsuits before the Supreme Court decision, positioning themselves advantageously if tariffs were overturned.
Additional legal conflicts seem inevitable. Manufacturers might pursue portions of supplier refunds if those suppliers had raised prices to cover tariff expenses.
“We may see years of ongoing litigation in multiple jurisdictions,” Early predicted.
Regular consumers face slim prospects for refund windfalls. Higher retail prices would be difficult to trace to specific tariffs. While Early wouldn’t recommend spending money on legal fees pursuing consumer refunds, she noted: “In America, we have the ability to file a lawsuit for anything we want.”
Illinois Governor JB Pritzker, a Democratic Trump critic, has demanded state refunds representing his state’s 5.11 million households. In a letter released through his campaign, Pritzker calculated tariffs cost each Illinois household $1,700 — totaling $8.7 billion. He warned of “further action” if payment isn’t provided.
Nevada Treasurer Zach Conine submitted a $2.1 billion payment request to federal authorities Friday, seeking to recover tariff costs for his state.
“As Nevada’s chief investment officer, I have a responsibility to try to recoup every single dollar that the Trump Administration takes from Nevada families,” Conine stated.
