The US government could be forced to refund as much as $1 trillion if the Supreme Court finds a large batch of President Trump’s tariffs illegal, according to Treasury Secretary Scott Bessent.
It has already collected tens of billions of dollars since Trump slapped foreign nations with harsh levies in April, which two lower courts have ruled was a breach of power.
If the Supreme Court agrees, the US could be forced to hand over between $750 billion to $1 trillion, Bessent warned in a court filing last week.
That staggering total could include roughly $72 billion in tariff revenue collected by US Customs since Trump’s “Liberation Day” announcement through Aug. 24, as well as projected dollars to be collected by next June.
A whopping $30 billion in tariff revenue was collected in July alone, according to the Treasury Department. That’s a 242% jump compared to the same period last year.
The Trump administration is urging the Supreme Court to quickly take up the case and back the tariffs, instead of waiting until next summer – which would force the US to refund cash collected over the next year, as well.
“Unwinding them could cause significant disruption,” Bessent told the Supreme Court.
It wouldn’t be the first time the US government has been forced to refund tariff revenue.
Importers of some Chinese goods were granted refunds under the Biden administration – but that total was far smaller than the eye-watering refund expected from Trump’s sweeping tariffs.
Bessent said he is “confident” that the Supreme Court will rule in Trump’s favor, but if the refunds are ordered, “we’d have to do it” – and that would be “terrible,” he told NBC News’ “Meet the Press” on Sunday.
“The stakes in this case could not be higher,” Solicitor General D. John Sauer wrote in the Trump administration’s petition.
“To the President and his most senior advisors, these tariffs thus present a stark choice: With tariffs, we are a rich nation; without tariffs, we are a poor nation.”
Sauer added: “The President predicts that if ‘the United States were forced to pay back the trillions of dollars committed to us, America could go from strength to failure the moment such an incorrect decision took effect,′ and ‘the economic consequences would be ruinous, instead of unprecedented success.’”
It is unknown when the Supreme Court will take up the case, and unclear how the administration would proceed if the refunds are ordered.
The decision could potentially mean a massive amount of work for customs – which has likely already been swamped by the end of the de minimis exemption, which allowed low-value packages to skip the customs process and avoid tariffs.
In the meantime, trade experts are urging companies hit hard by the tariffs to keep records of their payments, in case they need to file claims down the line.
Importers could also seek refunds if they think they were incorrectly charged.
Trump’s slew of tariffs has grown more complex over time, with some taxes stacking on top of one another, while others – like those on steel, aluminum or copper – are calculated based on the exact content of products.
Some importers are being approached by third-party firms with offers to buy their legal rights to potential refunds, according to the New York Times.
“We have a lot of clients asking about it,” Lenny Feldman, a managing partner of Sandler, Travis & Rosenberg, a law firm specializing in international trade, told the Times’ DealBook newsletter.
They’re betting that the Supreme Court will overturn Trump’s tariffs and reap them a substantial windfall.
