The Loadstar Leader: Tariff refunds – a safe bet?

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To be refunded or not refunded. As Donald Trump’s appeal against a lower court’s ruling that his tariff regime was not in keeping with the law nears its day before the highest court in the land, there is a wave of confusion over the prospect of refunds for importers.

Based on discussions The Loadstar has had with many experts – from lawyers to brokers and shippers – there seems to be an expectation that the Supreme Court will turn its nose up to the commander-in-chief and side with the lower court.

“It may be on matters of technicality,” one source explained, noting that the president had hardly exhausted the consultation process in Congress that the law he is depending on to legitimise the tariff programme requires, “but the lawyers tell us it is highly likely he will lose.”

Win or lose, legal experts have warned sharply against simply not paying the tariffs, and are cautioning against holding on to the hope of much touted refunds. “The advice being given is to pay,” another source noted.

“As to the idea that the Supreme Court will provide the definitive death knell for the tariff policy, the decision will be premised on a technicality and will leave open many other options to the president to impose tariffs,” they told The Loadstar.

“It is important to recognise that the tariffs are hard-wired into this administration and are an essential part of its policy programme,” the source added, noting that, as such, an issue of technicality is not likely to stop it indefinitely. “We may see a suspension,” the source added.

Even so, a lot of money is floating around this case. Some have suggested there could be as much as $1trn in refunds up for grabs, which, as The Loadstar reported yesterday, has attracted institutional investors, offering ‘cash now’ for potential refund rights tomorrow.

Several members of The Loadstar team have questioned why these investors would do this – unless they know something the rest of us don’t. Another member of the team said: “It’s a bet; in America they like to make these bets”.

So, what should importers do in this sea of swirling legal confusion? It seems the safest bet is to the swallow the tariff costs, but just as the US is keen on a bet, it also touts optimism – so keep records as meticulous as possible in the hope of that long-term payday.