TREASURY CHIEF SIGNALS $175B IN TARIFF REVENUE LIKELY LOST TO LITIGATION

TREASURY CHIEF SIGNALS $175B IN TARIFF REVENUE LIKELY LOST TO LITIGATION

Treasury Secretary Scott Bessent said Friday that $175 billion raised under the International Emergency Economic Powers Act (IEEPA) will likely never be recovered, following the Supreme Court's ruling that President Trump lacked authority to impose the tariffs.

The court decision, handed down last week, invalidated the administration's use of IEEPA to levy duties on trading partners. Bessent acknowledged the funds are now locked in litigation for refunds and unlikely to reach consumers or the government.

IEEPA tariffs were first imposed on China in February 2025, followed by Canada and Mexico in March, with additional "Liberation Day" tariffs in April. The White House is exploring alternative legal mechanisms to continue collecting tariff revenue going forward.

For CFOs managing supply chain costs and tariff exposure, the ruling creates immediate uncertainty: importers may face refund claims while the administration establishes new tariff authority. The $175 billion in disputed funds represents a significant contingent liability for companies that paid duties under the now-invalidated IEEPA framework.

Watch for Treasury guidance on which tariffs will be re-imposed under alternative legal authority and timelines for refund processing.