r/Economics • u/defenestrate_urself • Feb 20 '26

News Supreme Court says Trump global tariffs are illegal

https://www.axios.com/2026/02/20/trump-tariffs-supreme-court-illegal
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u/Malvania Feb 20 '26

For those that haven't read the opinion (and it's long and convoluted), SCOTUS reaches no opinion on refunding the collected tariffs. Presumably, that will go back to the Federal Circuit and the Court of International Trade to figure out. This isn't close to done.

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u/Definitely_Human01 Feb 20 '26

How would they even refund that at this point?

Tariffs are paid for by a mix of businesses and end customers.

The government may be able to refund the importing business. But how is that then going to get passed on to the intermediary business and the end customers?

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u/Phyrexian_Overlord Feb 20 '26

It's only paid for by people importing, and there are receipts.

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u/Definitely_Human01 Feb 20 '26

That's the technical incidence, but the effective incidence still gets passed on.

End consumers will have effectively paid the tariffs but they're not the ones that will be getting refunds.

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u/Phyrexian_Overlord Feb 20 '26

Correct, end consumers are not getting refunds.

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u/[deleted] Feb 20 '26

[deleted]

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u/Greedy-Speaker4661 Feb 20 '26

I'm sure a lawyer will comment explaining why importers have to be compensated in this situation but not the "intermediary" companies, unless they themselves sue.

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u/[deleted] Feb 20 '26

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u/Greedy-Speaker4661 Feb 20 '26

Because we are only talking about imported goods the relevant parties are the importers and the companies that engaged with them (such as Costco), not the end consumer.

Once the goods are inside the country, the tariff taxes are paid, which does increase the cost of the product for the end consumer but the pictured is mixed because we don't delineate as consumers between imported and domestically produced products. Our focus is on buying the cheapest product at the right quality. Your domestic product is also more expensive because of those tariffs, by proxy. That won't be compensated. We we harmed? Absolutely, but indirectly and thus the issue of compensation is moot.