In February, the U.S. Supreme Court struck down tariffs imposed under the International Emergency Economic Powers Act (IEEPA), ordering U.S. Customs and Border Protection (CBP) to return roughly $166 billion collected over the year the duties were in place. Eight months on, the refund wave is still only halfway out the door: a California watch retailer has waited nine months and recovered just $59,200 of the $164,000 it is owed.
The retailer is Collective Horology, run by owner Asher Rapkin. The day the Court ruled, Rapkin was so happy he jumped up and down in his kitchen with his kids. What followed was a nine-month grind: he filed his refund paperwork in March and did not see a dollar until September, when a $59,200 wire transfer arrived with no explanation of which transactions it covered. Rapkin calls the process "deeply flawed" — and notes the irony that when the tables are turned, FedEx demands payment within weeks and threatens to close his business accounts.
FedEx sits at the center of this refund saga as the "importer of record" for thousands of small businesses, handling 43% of the 53 million tariff entries the government collected. The company says it is focused on precision and regulatory compliance and has already disbursed hundreds of millions of dollars — but each claim must be checked, millions of entries verified, and records matched against government data. Only once customers submit accurate and complete information can FedEx disburse refunds within 30 days. In June, the company disclosed it had received $800 million in refunds belonging to customers and would begin paying them out in August.
The core reason for the delay is unprecedented scale. CBP had to build an entirely new system, CAPE, to process more than 53 million import transactions. The agency initially said it was not equipped to handle repayments at that scale, and the court granted additional time. Once live, the system processed 8.5 million entries in its first six weeks — compared with 338,000 entries for all refund types in the prior full fiscal year. Even so, as of June 29, CBP had authorized $104.3 billion in refunds but paid out only $71.1 billion, with an estimated $100.7 billion still owed — more than half the money unreturned. Another 8,384 approved refunds cannot be issued at all because the eligible importers have no valid ACH banking information on file: the money is approved but unreachable. Interest keeps accruing on the unpaid amounts, and taxpayers will ultimately foot that bill.
The refund process is stacked against smaller businesses. Under the rules, importers had to file a protest within 180 days of an entry's "final liquidation" to preserve their refund rights — effectively requiring companies to anticipate a future court ruling and sue the government preemptively. Those that did not may have lost their claims permanently. On the logistics side, UPS, FedEx, and DHL have all pledged to pass refunds through to customers; UPS says it can take up to 90 days to get the cash to customers after receiving it from CBP. Large consumer-facing companies are also moving: Costco says it plans to return refunds to shoppers "in some form," IDEX expects to rebate $14.7 million to customers (about two-thirds of the $20 million-plus it received), and Ford expects around $3 billion in tariff reimbursements from the government and suppliers combined, about $1.3 billion of it stemming from the Supreme Court's decision.
Two milestones lie ahead: CBP's online refund portal, which opened April 20, processes claims in phases — prioritizing the most recent unliquidated entries — with refunds issued within 60 to 90 days; and Judge Eaton of the Court of International Trade has required the government to file a progress update by April 28. Legal experts warn the government may still appeal, which could further delay payouts or alter how refunds are calculated. For "finally liquidated" entries, the administration argues it owes refunds only to businesses that filed individual lawsuits. In other words, the finish line for this $166 billion refund marathon keeps moving.