The Supreme Court told Donald Trump his tariffs were illegal. He owed $166 billion back to American importers. His response: launch a new tariff program, fight it in court again, and dare 56,000 businesses to try to collect what they're owed.
The refund portal went live April 20. The companies are in line. Trump is already back at the table trying to rerun the same play.
The $166 Billion Tax Grab
In February 2026, the Supreme Court struck down Trump's sweeping emergency tariffs, ruling they exceeded his authority under the law he invoked. The ruling came after more than 330,000 importers paid duties on 53 million shipments totaling up to $166 billion. Federal Reserve research found that U.S. businesses and consumers were absorbing nearly 90 percent of those costs, averaging $1,500 per household annually.
The Customs and Border Protection refund portal, known as CAPE, opened April 20. Within days, 56,497 importers had enrolled and were awaiting refunds on $127 billion of eligible duties. Processing is expected to take 60 to 90 days per claim, in phases. Not exactly fast relief for businesses that fronted the cash.
"U.S. businesses and consumers were covering almost 90% of tariff costs." — Federal Reserve research, 2026
The New Workaround, Already in Court
Rather than accept the loss, Trump invoked a different legal authority: Section 122 of the Trade Act of 1974, designed for short-term balance-of-payments emergencies. He imposed a 10 percent global tariff under this provision, valid for 150 days through July 24, 2026. A three-judge panel at the U.S. Court of International Trade is now hearing oral arguments on whether this workaround is any more constitutional than the last one.
The Tax Foundation estimates Trump's tariffs represent the largest U.S. tax increase as a percentage of GDP since 1993. Trading partners including Canada and China responded with retaliatory duties. Procter & Gamble raised prices on 25 percent of its products. The administration collected billions in taxes a court said it had no authority to collect, and is now quietly returning them while running the same play under a different statute.
Trump took $166 billion from American businesses through a legal mechanism the Supreme Court ruled unconstitutional. He is now seeking to do the same thing again through a different statute while the refund lines stretch around the block. If the new scheme also fails, expect a third.
Sources
- US launches tariff refund system as thousands of importers line up — Al Jazeera
- Tariff refund portal is America's hottest website — NPR
- Tariff Tracker: 2026 Trump Tariffs & Trade War by the Numbers — Tax Foundation
- US federal court hears new case against Trump tariffs — Al Jazeera
- Trump tariffs fall, but trade war impacts linger — CNBC
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