Federal court blocks Trump administration’s bid to delay tariff refunds process — all you need to know

A federal court on Monday (local time) dismissed the Trump administration’s effort to delay the repayment of billions in tariffs that the Supreme Court recently ruled unlawful, AP reported.

The U.S. Court of Appeals for the Federal Circuit advanced the refund process by referring the case to a lower court for further proceedings.

In a court filing Friday, the Justice Department urged the Federal Circuit to proceed cautiously and hold off for 90 days. But the judges refused.

On 20 February, the Supreme Court ruled that Trump’s broad tariffs on most countries were unlawful, allowing importers who had paid them to pursue refunds.

The government had collected more than $130 billion from the tariffs by mid-December and could ultimately be on the hook for refunds worth $175 billion, according to calculations by the Penn Wharton Budget Model, AP reported.

But the Supreme Court offered no guidance on refunds; its decision did not even mention them. Now the US Court of International Trade in New York will decide how the complicated refund process should proceed, AP reported.

"I would expect the Court of International Trade to quickly issue an order requesting a status update from the government on their plans with respect to refunds (or expedited briefing)," said trade lawyer Ryan Majerus, a partner at King & Spalding and a former US trade official. "I expect the court to take an aggressive posture, asking the government to justify how they intend to comply with the Supreme Court's ruling."

Siddartha Rao, a partner at law firm Hoguet Newman Regal & Kenney, said he has been getting a lot of calls from clients with questions, AP reported.

"We are somewhat in uncharted territory," he said.

The Trump administration has been reaching for new tariffs to replace those the Supreme Court struck down.

One question, he said, is how the government might actually pay for these refunds.

"Everyone is sort of cognizant of the fact that it's not like there's over a hundred billion dollars sitting in, you know, in a room somewhere to just cut checks," Rao said. "So, you know, this is a Treasury problem, and it may very well be that the administration is reimposing tariffs for the reasons that it's cited ... it's important for strategic trade agreements and for bargaining power and all of that. But it also might be that they need to raise revenue to pay out refunds."

(With inputs from AP)