The federal government refunded more than twice as much in customs duties as it collected in June 2026, with refunds reaching $49.18 billion against collections of $23.63 billion—a net outflow of $25.56 billion. The striking reversal comes from a new Tax Foundation analysis examining the aftermath of the Supreme Court's February 2026 decision striking down tariffs imposed under the International Emergency Economic Powers Act. In May, refunds nearly matched collections at $21.97 billion versus $21.93 billion, marking the start of what the report characterizes as a massive payback process for illegally collected duties.
Before the Supreme Court ruling, customs duties had been the federal government's fastest-growing revenue source through 2025, driven by President Trump's tariff policies. IEEPA tariffs alone accounted for roughly half of all customs collections. Monthly refunds of customs duties never topped $2 billion throughout 2025, but after the Court of International Trade ordered Customs and Border Protection to return the illegally collected IEEPA duties, refunds jumped to nearly $22 billion in May and nearly $50 billion in June. Approximately $165 billion in IEEPA tariffs were collected before the Court's decision, meaning the combined $71 billion refunded across May and June represents only the beginning—well over half of the illegally collected duties remain unreturned. Meanwhile, gross collections have fallen sharply from their October 2025 peak of $33.09 billion to $23.63 billion in June.
The report finds that the first wave of refunds covers only simpler claims, leaving more complex cases tied to finally liquidated entries stuck in procedural uncertainty. According to the authors, interest is accumulating on what's still owed—calculated at 4.5 percent for overpayments exceeding $10,000 or 6 percent below that threshold—and the administration has appealed the order requiring refunds to importers that never filed suit. The Tax Foundation notes that refunds will do little to reverse the damage imposed by the tariff regime, since while it's appropriate to refund duties to the legal entity that paid them, that may not align with who ultimately bore the economic burden.
The report explains that the real damage extends beyond the dollars refunded. The Harvard Pricing Lab estimates the tariffs were partly passed through to higher prices, meaning consumers and businesses downstream absorbed much of the economic cost—and refunds to importers won't make those groups whole. Even as refunds proceed for struck-down tariffs, other duties remain in force: immediately after the Supreme Court ruling, the Trump administration invoked Section 122 of the Trade Act of 1974 to impose a temporary 10 percent tariff on most imports through July 24, though the Court of International Trade ruled against those tariffs in May (that ruling is stalled pending appeal). On July 23, the U.S. Trade Representative took final action in Section 301 forced labor investigations, imposing duties of 10 to 12.5 percent on 86 countries with broad exemptions, and invoked Section 338 of the Tariff Act of 1930—never before used to impose duties—for a 50 percent tariff on selected Canadian goods beginning August 19. Both are likely headed to court.
The report estimates U.S. tariff policy has changed more than 50 times since the start of Trump's second term—tariffs were imposed under IEEPA, struck down, replaced under Section 122, ruled illegal again but left in place, expired, and replaced a second time under Sections 301 and 338, all within 18 months. For businesses making decisions on a long time horizon, that uncertainty suppresses investment and hiring and distorts pricing decisions, the authors write. The economic damage from a chaotic tariff regime can outweigh the revenue itself—and unlike the tariffs, it can't be refunded.