A consumer paid a $26.05 tariff on a U.K. purchase that a federal appeals court ruled the U.S. government had no right to keep, though the tariff remains in place until October pending litigation. Continued legal losses by the administration could require refunds to tens of millions of Americans and cost hundreds of millions of dollars, producing severe administrative disruption. Senior officials warned that reversing the tariffs would cause diplomatic embarrassment and dire consequences. The consumer paid the shipper, which likely remitted a lump-sum payment. DHL exited the U.S. market amid the tariff turmoil, ending certain shipments in April and August, complicating refund logistics.
Last week, I paid a $26.05 tariff on a small purchase from the United Kingdom. On August 29, a federal appeals court ruled that the U.S. government had no right to take that money. It allowed the tariff to remain in place until October, pending further litigation. But the Trump administration has lost every round of this fight to date. If it keeps losing, the question will sooner or later arise: What happens to my $26.05?
In a filing with the court of appeals, Treasury Secretary Scott Bessent said that overturning Donald Trump's tariffs would count as a "dangerous diplomatic embarrassment." And Commerce Secretary Howard Lutnick warned that an about-face would have "devastating and dire consequences." One of those consequences might be that the U.S. government would suddenly owe tens of millions of Americans hundreds of millions of dollars, and, in that scenario, would face total administrative chaos repaying the money it wrongfully took.
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