An anticipated U.S. Supreme Court decision to invalidate tariffs imposed under the International Emergency Economic Powers Act (IEEPA) may bring short-term relief to importers—but it is unlikely to mark the end of tariff-related uncertainty.
At the center of the case is whether IEEPA grants the President authority to impose tariffs during a declared national emergency. While the statute allows broad executive action in emergencies, it does not explicitly reference tariffs as a permitted remedy. During oral arguments, several justices expressed skepticism about extending IEEPA’s authority to cover import duties.
If the Court rules against the use of IEEPA for tariff enforcement, a new and complex issue will immediately follow: how previously collected duties should be refunded.
Refunds Could Total Hundreds of Billions
Importers could collectively seek refunds estimated at up to $168 billion, creating a significant administrative challenge for U.S. Customs and Border Protection (CBP). Under current rules, importers have 180 days from liquidation—the final determination of duties owed—to file refund claims. Since most entries are liquidated within roughly ten months of arrival, time is already running short for many importers seeking recovery.
It remains unclear whether CBP would be tasked with processing refunds or whether disputes would be handled through the Court of International Trade. Some importers have already filed protective claims in anticipation of a favorable Supreme Court ruling.
Liquidation Timing Adds Pressure
CBP retains discretion over when entries are liquidated. In response to an adverse ruling, the agency could accelerate liquidation timelines, forcing importers to act quickly by filing protests or pursuing litigation. Appeals to the Court of International Trade must generally be filed within two years.
This dynamic places added pressure on importers to proactively review entries and ensure they preserve their rights to potential refunds.
Documentation Will Be Critical
Recovering tariffs will require importers to clearly identify and document IEEPA-related duties, separating them from other tariff programs and fees. That process could involve reviewing a year or more of import records to determine which entries were subject to the disputed tariffs.
The scale of this effort is unprecedented. While there have been instances of large-scale tax refunds in the past, none have approached the magnitude of potential IEEPA reimbursements.
Refunds Are Not Guaranteed
Even if the Court invalidates the tariffs, full reimbursement is not assured. CBP could attempt to offset refunds by imposing temporary replacement duties under other statutory authorities. In addition, interest payments on refunded duties may be denied.
Importers should also be aware that a ruling on IEEPA would not affect tariffs imposed under other laws, including Section 232, Section 301, or the Tariff Act of 1930. Relief under IEEPA could be followed by new duties under alternative legal frameworks that require higher evidentiary standards but remain available to policymakers.
A Long Road Ahead
Regardless of the outcome, importers should prepare for a prolonged process. Some may explore assigning claims to financing firms in exchange for immediate, discounted payment, though such arrangements are currently limited by uncertainty surrounding the final legal outcome.
In the end, even a favorable Supreme Court ruling would represent only one chapter in a broader and ongoing evolution of U.S. trade policy. For importers, careful documentation, proactive compliance, and strategic planning will be essential as the situation continues to unfold.
