Analysis warns U.S. importers are accruing hundreds of millions in monthly interest while awaiting refunds for tariffs invalidated by the Supreme Court.
By yourNEWS Media Newsroom
The federal government may face a rapidly growing financial obligation to American importers following a Supreme Court ruling that invalidated large portions of the Trump administration’s emergency tariff program, with a new analysis estimating delays in issuing refunds could add hundreds of millions of dollars in interest each month.
According to a report published by the Cato Institute, delayed repayments tied to tariffs struck down by the high court are costing importers roughly $700 million in interest every month—about $23 million per day—while businesses wait to be reimbursed for duties the report argues were improperly collected.
The potential refund obligation itself could reach as high as $175 billion, reflecting duties imposed under sweeping tariff measures targeting a broad range of trading partners before the Supreme Court ruled against the policy.
“If you import a good and pay a duty on it that the government assesses was wrong, you get your money back with interest because that capital was tied up,” Scott Lincicome, vice president of general economics at the Cato Institute, told CBS News.
The Trump administration had previously indicated it would issue refunds if the judiciary determined the tariffs—imposed under emergency powers—were unlawful.
White House spokesman Kush Desai declined to directly address the think tank’s analysis but defended the broader tariff strategy implemented by President Donald Trump. Desai said Americans “have seen inflation cool, economic growth accelerate, and trillions in investments pour into American manufacturing — on top of new deals to cut prescription drug prices and end unfair foreign trade practices.”
“Americans continue to reap the benefits of President Trump’s powerful use of tariffs,” Desai added.
A procedural decision earlier this week removed a key obstacle to the refund process. The U.S. Court of Appeals for the Federal Circuit rejected the administration’s effort to delay repayments, according to a report by Newsmax. The ruling allows the U.S. Court of International Trade to proceed with establishing a system to reimburse importers that successfully challenged the tariffs.
Cato’s estimate of the government’s potential liability assumes roughly $175 billion in duties had been collected when the tariffs were invalidated earlier this year. That estimate incorporates projections from the Penn Wharton Budget Model and other economic sources.
Official federal data suggests the total amount collected may be somewhat lower. Figures published by U.S. Customs and Border Protection show that through the end of 2025 the federal government collected $134 billion in duties under the International Emergency Economic Powers Act.
Under existing customs rules, the government must pay interest when reimbursing importers for duties collected in error. Federal law governing those payments is outlined in federal regulations, which require interest to be added to reimbursable tariff overpayments.
Refund interest rates are tied to the IRS corporate overpayment rate structure. According to the Cato analysis, the current rates—6% for shipments valued under $10,000 and 4.5% for larger imports—could generate substantial additional costs if reimbursements are delayed.
Using those rates, the report estimates that a one-year delay in refunding the duties collected under the International Emergency Economic Powers Act could add approximately $8.4 billion in interest payments on top of the original tariff repayments.
“I don’t know what the administration will argue, but the law says — and courts have been clear — that they are going to require refunds with interest,” Lincicome said.
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