NEW YORK — A U.S. Customs and Border Protection official is scheduled to testify in federal court regarding the government's plans to refund tariffs paid by importers. The testimony follows a Supreme Court ruling that found President Donald Trump illegally imposed certain tariffs on goods from most other countries.
Court of International Trade Judge Richard Eaton said he is holding a hearing to determine whether to order the government to expedite and expand its tariff refund system. Eaton said he wants to hear details "to ascertain if it is the government's policy to return all of the unlawfully collected duties either by complying with the court's order, or by some other means." The Justice Department appealed an earlier order by Eaton to make all businesses that paid the invalidated import taxes eligible for refunds plus interest.
The Justice Department argued in a court filing that only companies involved in lawsuits challenging the tariffs are legally entitled to seek refunds. The U.S. Court of Appeals for the Federal Circuit is reviewing the dispute over tariff refund eligibility. In March, Eaton ordered CBP to create a system allowing all importers of record to apply for refunds.
CBP launched an online refund application system on April 20. The agency limited initial refund applications to businesses whose tax bills were unfinalized or settled within 80 days prior to the late February Supreme Court ruling on the tariffs.
As of June 1, CBP reported that $89.6 billion in refund claims had been accepted for processing. The agency also reported that it had directed the Treasury Department to issue $20.6 billion in refunds. CBP estimated it collected $166 billion in tariffs before the Supreme Court invalidated the global tariffs.
Eaton previously ordered CBP Commissioner Rodney Scott to appear in court to discuss the agency's timeline for complying with his refund order. The Justice Department requested a CBP deputy attend the hearing instead of Scott. The U.S. Court of Appeals for the Federal Circuit temporarily suspended the requirement for Scott to testify. Eaton agreed to hear from Susan Thomas, CBP executive assistant commissioner for trade, in place of Scott.
In a court declaration, Susan Thomas stated that CBP is developing a method to handle refunds for older shipments but will not process cases beyond the 80-day window while Eaton's order remains on appeal. The five companies that initiated the underlying lawsuit requested Eaton certify their case as a class action representing "potentially tens of thousands of identically situated importers."
Meghann Supino, a partner at the law firm Ice Miller, said she believes CBP will continue developing necessary refund technology, but "whether they open it up to non-litigants and importers that do not have orders for their own sake is going to continue to be an issue with the appeal."