Trump's tariffs ruled illegal, U.S. courts advance refund process, with refunds potentially reaching $175 billion

On March 5, the U.S. International Trade Court issued a new judicial order providing a legal pathway to refund tariffs imposed during the Trump administration under the International Emergency Economic Powers Act (IEEPA). Previously, the U.S. Supreme Court had ruled that these tariffs were not legally authorized.

Judge Richard K. Eaton of the U.S. International Trade Court stated in his ruling that American importers affected by IEEPA tariffs are entitled to the legal effect of the Supreme Court’s decision. He also ordered U.S. Customs and Border Protection to reprocess the clearance procedures for relevant imported goods, excluding IEEPA tariffs from the calculation of final payable amounts.

“Clearance” refers to the process where customs finalizes the tariffs and fees for imported goods. According to Eaton’s order, any import bills that have been calculated but not yet finalized must be recalculated as if the relevant tariffs were never implemented. Typically, importers can raise objections within 180 days after goods are cleared, and only then do the final accounts become official.

This ruling is seen as a significant judicial restriction on the trade policies of the Trump administration. In April 2025, Trump issued an executive order declaring so-called “Liberty Day Tariffs,” imposing double-digit tariffs on imports from multiple countries, claiming the move aimed to increase government revenue and reshape U.S. trade patterns.

However, on February 20, 2026, the U.S. Supreme Court ruled 6-3 that the IEEPA did not grant the president unilateral authority to impose tariffs, rendering those measures legally unsupported. While the ruling confirmed the tariffs were unlawful, it did not directly specify the refund mechanism at that time.

In his latest order, Eaton stated that he will serve as the sole judge responsible for cases related to IEEPA tariff refunds to ensure uniform standards and expedite the process.

The exact scale of refunds has not yet been finalized. A budget model from the University of Pennsylvania’s Wharton School estimates that if all tariffs are revoked and refunds are issued, the total amount could reach $175 billion.

So far, the White House and U.S. Customs and Border Protection have not publicly responded to this judicial order. Market analysts believe that this ruling could have ongoing impacts on U.S. trade policy, the cost structure of import businesses, and the future scope of executive authority.