US court orders refunds on IEEPA tariffs

A US court has ruled for businesses to receive refunds on billions of dollars in emergency tariffs after the Supreme Court determined last month that they were wrongfully imposed.

The US Court of International Trade has ordered Customs and Border Protection (CBP) to issue refunds on levies President Donald Trump had introduced last year via the International Emergency Economic Powers Act (IEEPA). Judge Richard Eaton said that “all importers of record whose entries were subject to IEEPA were entitled to benefit” from the ruling.

The case had initially been brought forth by Tennessee-based Atmus Filtration, which had claimed rights to a tariff refund. The argument was in relation to a series of “Liberation Day” tariffs ranging between 10 to 50 percent imposed by Trump last year. This was followed by a series of trade negotiations with global nations seeking to lower the rates in exchange for investments and other commitments.

This February, however, the US Supreme Court struck down the duties, finding them unconstitutional under the emergency powers law. Trump immediately responded to the court’s decision by implementing a 10 percent universal levy, before subsequently raising the global tariff rate to 15 percent, the legal limit possible for 150 days before requiring congressional approval.

The Trump administration is estimated to have accumulated around 130 billion dollars from tariffs imposed on imported goods into the US under IEEPA. Customs has now been ordered to stop collecting associated tariffs, and the CBP has been instructed to come up with a way to process the refunds.

The latest decision by the trade court has been largely lauded as a success by national trade organisations. The president of the US Fashion Industry Association (USFIA), Julia Hughes, said the group applauded the ruling, stating: “This decision will improve affordability for American families and consumers, and will remove the economic uncertainty that has held back many companies from making new investments."