Trump administration says it can't comply with order to start tariff refunds
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A dockworker at the Port of Long Beach in Calif. Photo: Patrick T. Fallon/AFP via Getty Images
The Trump administration said on Friday that it could not immediately start issuing tariff refunds, casting new doubt about when U.S. businesses will get the hundreds of billions of dollars owed to them.
Why it matters: Trump officials say the process is too sprawling and complex, likely dragging out repayment.
- The government's argument appears to have been successful: Later on Friday, the Court of International Trade reversed a previous order that mandated the government instantly start the refund process, Reuters reported.
Between the lines: It is the latest in the fallout from the Supreme Court decision last month that ruled the bulk of Trump tariffs — those imposed under the International Emergency Economic Powers Act — were illegal.
What they're saying: U.S. Customs and Border Protection is now facing "an unprecedented volume of refunds," Brandon Lord, a top official in the agency's trade division, wrote in a court filing.
- Lord said CBP's "existing administrative procedures and technology are not well suited to a task of this scale and will require manual work that will prevent personnel from fully carrying out the agency's trade enforcement mission."
- "Personnel would be redirected from responsibilities that serve to mitigate imminent threats to national security and economic security," he wrote in the filing.
- Lord said that the agency is working on new "functionality" to its system that could streamline the refund process — ready for use in 45 days, according to the filing.
The intrigue: The filing confirms that the government owes $165 billion in tariff refunds, without interest — a sum similar to what has been previously estimated by Wharton Penn.
The big picture: Updates in this case — no matter how incremental — are being followed closely by businesses waiting for, in some cases, large sums of money.
- A key tension in the refund saga has emerged: the court wants to move fast to get refunds out the door, but the government has pushed to slow-walk the process.
Zoom in: The government has previously argued the refund process is a burden for customs officials.
- Tariff entries — the individual records created for shipments crossing the U.S. border — have expiration dates of sorts.
- Once those entries "liquidate" and get finalized in CBP's system, clawing back the money gets more complex.
- "Currently, it is not possible for CBP to immediately prevent any additional entries from liquidating without IEEPA duties," Lord wrote in the filing.
Go deeper: The clock is ticking on tariff refunds
