How Trump's tariff refunds could work if he loses

Justice Amy Coney Barrett said $90 billion tariff refunds could be a "mess." California AG Rob Bonta called it justice.

Justice Amy Coney Barrett (Photo by Mario Tama/Getty Images)

Journalism with a focus on justice, in the deepest sense.

As Supreme Court oral arguments appeared to go sour for Donald Trump on tariffs, Supreme Court Justice Amy Coney Barrett raised a practical concern: “If you win, tell me how the reimbursement process would work. Would it be a complete mess?”

Barrett posed that question to attorney Neal Katyal, who was representing a coalition of small businesses affected by Trump’s tariffs.

All of the justices missed the opportunity to present the government with that question during more than two-and-a-half hours of marathon presentations. So the government avoided providing a definitive answer. For Katyal’s clients, the answer was simple.

“In this case, the government stipulated for the five plaintiffs that they would get their refunds,” Katyal said. “So for us that’s how it would work.”

But the small businesses that Katyal represents, led by the educational toy manufacturer Learning Resources, are a drop in the bucket of the estimated $90 billion that the federal government has collected to date from Trump’s tariffs.

“With respect to everyone else, there’s a whole specialized body of trade law, and 19 U.S.C. 1514 outlines all these administrative procedures,” Katyal explained. “It’s a very complicated thing. There’s got to be an administrative protest.”

Acknowledging the process would be “difficult,” Katyal added that was not a reason for the court to avoid ordering the Trump administration to pay out those refunds. Indeed, Trump’s Justice Department promised in court records that businesses affected by the tariffs “can be made whole through a refund, including interest,” in order to persuade lower courts to maintain his tariffs after other judges ruled them to be illegal.

Katyal said that the Supreme Court also had the option to block the tariffs prospectively, offering the government a chance to renege on their promised refunds.

In an interview on Legal AF, California Attorney General Rob Bonta said that would still be a win for the states and small businesses, but it would fall short of complete justice.

“I think that would be cold comfort to Americans and Californians who will have a U.S. Supreme Court say that these tariffs were unlawful, and they will feel victimized by an unlawful action by a president with no remedy,” Bonta said. “If someone does something unlawful, there should be accountability. If someone is harmed, they should be healed, and they should be given restitution.”

Bonta acknowledged the process could be “messy.”

“It could take time,” he said. “They might have to apply for it. They might have to show the harm that they endured, but they should be able to receive some sort of reimbursement or refund.”

According to experts interviewed by ABC News, those entitled to tariff refunds would be businesses, rather than consumers who felt the pain of raised prices. Even then, the businesses would have to expect long wait times.

“I think the important part that we are trying to manage expectations with all of our clients is even to the extent that a process is put in place, and to the extent that there is a process that you qualify for, you put in your application, there’s going to be a high volume involved here, very heavy volume,” international trade attorney Matt Lapin told ABC News.

Even without the refunds, the Supreme Court striking down Trump’s tariffs would mark a huge victory for the small businesses.

“I think it would definitely be better than ongoing tariffs because if the tariffs are prospectively terminated, then we’re back where we have certainty. We have predictability,” Bonta said. “You can do long term planning. You can do capital investments as a business. You can hire people and know what the economics are going to be, and you can grow. You can expand.”

The attorney general added that the public, however, might recognize that as partial justice.

“I think just common views of fairness would leave people feeling a little empty and wronged and honestly victimized if they didn’t have a chance to get reimbursed for the harm that was visited on them by a president acting unlawfully,” he said.

Watch the full conversation between Michael Popok, Bonta and me below.