Supreme Court Case Puts $108 Billion in Tariff Refunds in Play for Retailers
A ruling against the government on IEEPA-based tariffs could deliver a massive windfall to importers like Walmart, Target, and Home Depot, easing years of price pressure.
The U.S. Supreme Court is hearing arguments this week in a case that could dismantle a key pillar of U.S. trade policy and trigger a potential refund of over $100 billion to some of the nation's largest importers. A ruling against the government could invalidate years of tariffs imposed under the International Emergency Economic Powers Act (IEEPA), providing a significant financial windfall for the retail and consumer goods sectors, which have borne the brunt of the duties.
The case challenges the executive branch's authority to use the 1977 law to impose sweeping tariffs on goods from China and other countries. Should the court side with the importers, it could force the government to refund an estimated $108 billion in duties collected since 2018, according to analysis from PwC.
For major retailers like Walmart, Target, and Home Depot, along with hundreds of other companies importing everything from furniture to electronics, such a decision would represent a massive injection of capital. These businesses have spent years navigating the financial pressures of the tariffs, which forced them to either absorb the higher costs, squeezing profit margins, or pass them on to consumers, contributing to inflationary pressures.
The economic impact of these duties has been substantial. The average effective tariff rate for U.S. consumers reached 17.9% as of October 2025, costing the average American household an estimated $1,800, according to the Yale Budget Lab. Economists have projected that the tariffs are set to slow U.S. real GDP growth by half a percentage point this year and next.
The list of affected companies highlights the broad reach of the trade policy. While retail giants are among the most exposed, the impact extends deep into the manufacturing and industrial sectors. Tariffs on steel and aluminum under Section 232 of the Trade Expansion Act—a related trade provision also facing legal scrutiny—have raised input costs for companies like General Motors and Tesla. Meanwhile, duties on finished goods have hit companies as diverse as Skechers, Hasbro Inc., and La-Z-Boy, as reported by Forbes.
Investors are now closely watching the Supreme Court for a decision that could dramatically alter the financial landscape for the consumer sector. A ruling in favor of the importers would not only provide immediate financial relief but could also lower costs on a go-forward basis, potentially easing supply chain bottlenecks and boosting corporate earnings.
However, the outcome remains uncertain. A decision is not expected for several months, and the legal arguments are complex. Furthermore, trade experts note that even if the court strikes down the tariffs under IEEPA, the administration could potentially seek to re-impose similar duties under different legal authorities. For now, the retail and consumer goods sectors are in a holding pattern, awaiting a verdict that could either unwind years of costly trade policy or solidify the current state of heightened import costs.