Treasury Secretary Says U.S. Can Cover Tariff Refunds if Supreme Court Rules Against Administration

By Ginika Igboke

Treasury Secretary Scott Bessent said the department would have no difficulty covering potential tariff refunds if the Supreme Court rules that the administration’s tariffs are unlawful.

“It won’t be a problem if we have to do it, but I can tell you that if it happens—which I don’t think it’s going to—it’s just a corporate boondoggle,” Bessent told Reuters in an interview over the weekend. He questioned whether companies challenging the tariffs would return any refunded money to consumers, citing Costco, which is suing the federal government.

Bessent said the Treasury currently holds about $774 billion, more than enough to cover any refunds ordered by the court. He added that any repayment would likely be spread over time. “We’re not talking about the money all goes out in a day,” he said. “Probably over weeks, months, may take over a year.”

The Treasury secretary also pushed back against claims that tariffs have fueled inflation, saying companies have largely absorbed the added costs. He said there has been “very, very little, if any, pass-through” to consumers and argued that goods inflation has remained below overall headline inflation.

Speculation that the Supreme Court would issue a tariff-related ruling on Jan. 9 did not materialize, as the court released only one opinion that day involving a criminal case. The justices have scheduled Jan. 14 as their next date for issuing orders. Speaking last week at the Economic Club of Minnesota, Bessent said he expects a mixed decision. “If they rule against us, then it will be some kind of a mishmash of ‘you can do this; you can’t do that,’” he said.

Bessent also said Treasury budget data for calendar year 2025 is expected to show a deficit reduction of $300 billion to $400 billion compared with calendar 2024, which would provide additional fiscal capacity. The federal government operates on a fiscal-year basis and reported a deficit of $1.775 trillion for fiscal year 2025, which ended Sept. 30.

The Trump administration has relied on the International Emergency Economic Powers Act, a 1977 law, to impose broad tariffs on nearly every country under emergency provisions. Several companies, including Costco, have sued the administration, arguing the tariffs were implemented unlawfully. Multiple lower federal courts have ruled against the tariffs, leading the White House to appeal to the Supreme Court.

President Donald Trump has repeatedly defended the tariffs, describing them as essential leverage for national security and foreign policy objectives. He has also claimed the duties have helped prevent conflicts.

“If a President is not allowed to use Tariffs, we will be at a major disadvantage against all other Countries throughout the World,” Trump wrote in a November post on Truth Social. In a Jan. 2 post, he said tariffs are “an overwhelming benefit to our Nation,” calling them critical to U.S. national security and prosperity and warning that losing the ability to impose them would be a “terrible blow” to the country.

According to Bureau of Economic Analysis data released Jan. 8, the U.S. trade deficit narrowed sharply in October 2025, falling to its lowest level in 16 years. The Treasury Department said the United States has collected $98 billion in tariff revenue so far this year.