Legal/Law/Criminal Justice and Reform

Trump Admin Says It Can’t Comply With Order To Issue Tariff Refunds

(Screenshot via White House)

The Trump administration can’t immediately comply with a court order to issue tariff refunds, according to a U.S. Customs and Border Protection (CBP) official.

Processing the “unprecedented volume of refunds” would require work that steers personnel away from “responsibilities that serve to mitigate imminent threats to national security and economic security,” Trade Programs Directorate Executive Director Brandon Lord told the court in an affidavit filed Friday morning.

The Court of International Trade directed the administration on Wednesday to start issuing refunds for tariffs imposed under the International Emergency Economic Powers Act (IEEPA). The Supreme Court held Feb. 20 that President Donald Trump did not have authority under the statute to issue tariffs.

The government has collected approximately $166 billion in IEEPA duties and estimated duty deposits as of Wednesday, according to the affidavit. Existing procedures and technology “are not well suited to a task of this scale,” Lord wrote, noting processing all of the “53,173,939 entries with IEEPA duties will require 4,431,161 man hours for CBP to complete.”

Some companies that attempted to reclaim duties have already been denied refunds, the Financial Times reported Friday.

“CBP has never been ordered to, nor has it attempted to, process a volume of refunds anywhere near the volume of total entries and Entry Summary lines on which IEEPA duties have been deposited,” Lord wrote. “However, where CBP’s predecessor, the U.S. Customs Service, was previously ordered to refund to exporters the Harbor Maintenance Fee (HMF) that was held to have been unconstitutionally imposed as applied to exports by the Supreme Court in United States Shoe Corporation v. United States (1998), the process took several years to complete and required an updated regulatory procedure.”

The agency is “confident” it will be able to develop a new process that will “streamline and consolidate refunds and interest payments on an importer basis, rather than issuing 53,173,939 separate entry-specific refunds with multiple payments going to the same importer.” It hopes to have the new process ready within 45 days.

“The process will be simpler and more efficient than the existing functionalities, and CBP will provide guidance on how to file to refund declarations in the new system,” the affidavit states.

Meanwhile, a group of Democratic state attorneys general sued the administration Thursday over Trump’s new tariffs, claiming he was trying to “sidestep” the Supreme Court. Trump imposed a “10% global tariff under Section 122” shortly after the Supreme Court decision, which he increased the next day to 15%.