State officials demand transparency as businesses get billions in Trump tariff refunds

By Kevin Hardy | Stateline

The fiscal leaders of several states are demanding transparency and consumer fairness as President Donald Trump’s administration seeks to refund billions in international tariffs following a recent Supreme Court loss. 

In a February decision, the high court dealt a blow to the president’s trade agenda, ruling by a 6-3 margin that the tariffs he issued under the International Economic Emergency Powers Act were illegal.

Last month, U.S. Customs and Border Protection began accepting applications from importers and brokers who are owed an estimated $166 billion in import tax refunds. While companies are receiving those refunds, it appears that many don’t intend to share those funds with consumers, who paid for much of the tariffs through higher prices. 

“We’re the ones who paid it. We’re the ones that need to get it back, and so any system that doesn’t get it to the little guy doesn’t get it to the right place,” Minnesota State Auditor Julie Blaha said on a press call Wednesday.

She was among eight Democratic state fiscal leaders who urged the White House to publicly disclose which firms are receiving tariff refunds and to ensure consumers are not left out.

Blaha said government agencies are well equipped for that task, noting the public websites set up during the coronavirus pandemic that disclosed which companies received pandemic grants and loans. There is currently no public database of tariff refund requests or agency determinations.  

“We’re not asking the federal government to do anything they don’t ask of states and local entities or nonprofits to do when they are using some of their funds,” she said. “We know how to do this kind of oversight.”

Blaha said transparency is particularly important since the White House is opposed to repaying the tariffs in the first place. The president has said his administration would “fight” the refund effort, though reports indicate more than $35 billion has already been sent to companies. 

Illinois State Treasurer Mike Frerichs said American consumers are suffering from high prices as the president and his inner circle enrich themselves. 

“No one trusts the federal government anymore,” he said. “They feel like the deck is stacked against them, and this example just adds further proof to their beliefs.”

State leaders estimated the tariffs cost Illinois consumers nearly $9 billion. But the current process does not ensure that those funds will be returned to consumers. 

“Trump’s system is opaque by design, with no guarantee of the $9 billion owed to Illinois families and businesses returning home,” Frerichs said Wednesday. “…Millions of Americans and businesses deserve every penny back.”

The president blasted conservative Supreme Court justices who nixed his tariffs, saying their decision earlier this year was a “disgrace to our nation” as well as “unpatriotic and disloyal to our Constitution.”

He has remained committed to tariffs on foreign imports, believing that they will incentivize manufacturers to build products in the United States rather than overseas. 

After the Supreme Court loss, Trump ordered a 10% global tariff, which has also been challenged in court. Last week, the U.S. Court of International Trade granted a permanent injunction to a Florida-based toy manufacturer and a New York-based spice importer that sued the Trump administration over those tariffs. 

Stateline reporter Kevin Hardy can be reached at khardy@stateline.org.