IEEPA Tariff Refunds: What’s Next?

31 Mar IEEPA Tariff Refunds: What’s Next?

Recently the U.S. Supreme Court ruled that tariffs assessed under the International Emergency Economic Powers Act (IEEPA) were illegally imposed by the Trump Administration, a decision that potentially triggers more than $90 billion of refunds.

In addition, the Court granted the U. S. Court of International Trade (CIT) authority to determine the refund process and a judge from CIT has ordered the US government begin issuing refunds for these tariffs.

Since this ruling, the U.S. Customs and Border Protection (CBP) filed a declaration with the U.S. Court of International Trade (CIT) outlining its proposed tariff refund process.

As part of this process, the CBP has explained that the unusually high volume of refunds and existing system constraints prevent it from processing IEEPA tariff refunds through the normal process, so it has been developing new refund capabilities in the Automated Commercial Environment (ACE) called the Consolidated Administration and Processing of Entries (CAPE) to calculate and issue accurate refunds. This system enhancement is nearing 70% completion stage.

Whilst it is anticipated that the Trump Administration will appeal this ruling, it is advisable that all importers ensure their ACE and Automated Clearing House (ACH) refund accounts are set up and that they monitor the rollout of the CAPE system once the system goes live to claim their refunds as soon as possible.

Instructions for setting up an ACH refund account can be found here.

Within hours of this ruling, President Trump announced a replacement 10% global tariff under Section 122 of the Trade Act of 1974, which could rise to 15% for up to 150 days pending Congressional approval. You can view more information about this tariff here.

How to prepare for IEEPA refunds – an importer’s checklist:

• Confirm ACE Portal access for the Importer of Record;
• Verify ACH refund enrolment within ACE;
• Identify entries where IEEPA tariffs were assessed and paid; and
• Maintain supporting documentation, including entry summaries, invoices, and duty payment records.

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