The United States customs agency is preparing a system that could begin processing refunds for tariffs imposed under President Donald Trump within 45 days, after the duties were struck down as illegal by the Supreme Court.
In a court filing, Customs and Border Protection (CBP) official Brandon Lord said the agency is developing a process that will allow importers to recover payments made under the now-invalid tariffs.
“This new process will require minimal submission from importers,” Lord wrote in his declaration filed with the US Court of International Trade.
The filing came as government lawyers met with Judge Richard Eaton to discuss how the government will implement a sweeping order directing CBP to start refunding tariffs paid by hundreds of thousands of companies.
According to Reuters, the refunds could total $166 billion, covering tariff payments made by around 330,000 importers.
Last month, the US Supreme Court ruled that the tariffs were unconstitutional, striking down a policy that had been a central part of Trump’s economic agenda. The ruling did not specify how the government should return the collected tariffs, leaving businesses uncertain about the refund process.
Judge Eaton is overseeing about 2,000 lawsuits filed by importers, including companies such as FedEx and L’Oreal, seeking repayment of duties.
Additional lawsuits continue to emerge. On Friday, affiliates of Nintendo and CVS also filed legal challenges seeking refunds.
REFUNDS EXPECTED THROUGH A SINGLE PAYMENT
Under the proposed system, importers would submit a declaration through CBP’s Automated Commercial Environment (ACE) system outlining tariff payments.
Once verified, refunds would be issued with interest.
Each importer would receive a single payment from the US Treasury Department, regardless of how many separate shipments were involved.
Lord noted that the agency cannot immediately comply with Eaton’s earlier order because its existing systems are not designed to handle a refund process of such scale.
“Its existing administrative procedures and technology are not well-suited to a task of this scale,” he said.
According to the filing, importers paid roughly $166 billion in tariffs across more than 53 million shipments. Processing refunds manually under the existing system would require more than 4 million hours of labor, Lord said.
The declaration also revealed that relatively few importers have registered for the CBP’s electronic refund system. Out of the 330,000 importers affected, only 21,423 had enrolled in the system as of early February.
Judge Eaton is using a lawsuit filed by Atmus Filtration Inc as a test case to determine how the government will distribute refunds to all eligible importers.
(With inputs from Reuters)
