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The US government has refunded tens of billions of dollars in collected tariffs after the Supreme Court struck down a major portion of President Donald Trump's extra tariffs ordered, marking a significant setback for one of his flagship economic policies.
Newly released Treasury budget figures show the refunds surged following the court's ruling, wiping out much of the revenue generated by the contested tariffs.According to US budget data released on Monday, the government has paid $81 billion in tariff refunds during the current fiscal year, which began in October 2025, compared with $5 billion during the same period a year earlier.A treasury department official told AFP reporters that the sharp increase was "almost entirely" due to the Supreme Court's ruling, with most of the repayments made in May and June.Tariffs on imported goods formed a central pillar of Trump's economic agenda after he returned to office last year. The administration argued the duties would revive domestic manufacturing, secure better trade agreements and reduce the federal budget deficit.However, the US Supreme Court ruled in February that a substantial portion of the additional tariffs had been imposed unlawfully, requiring the government to refund companies that had paid them.
The administration's trade policy suffered another legal setback in May when, the US Court of International Trade ruled that the administration's blanket 10 per cent tariffs were unlawful.In a split 2-1 decision, the court held that the government had failed to establish sufficient legal authority under Section 122 of the Trade Act of 1974 to impose the duties. The tariffs had been introduced after the Supreme Court struck down an earlier and broader set of levies.The latest budget figures indicate that the federal deficit has begun widening again despite tariff collections.The deficit reached $1.367 trillion during the first nine months of the fiscal year, an increase of 2 per cent, while interest payments on the national debt exceeded $1 trillion, up 14 per cent. Military spending also rose 5 per cent, reflecting higher costs linked to the conflict in the Middle East, according to budget data.According to The Guardian, the White House is preparing a new round of tariffs once the current temporary 10 per cent global tariff expires on 24 July. The proposed measures, reportedly aimed at countries accused of weak enforcement of anti-forced labour laws and excess industrial capacity, could affect trading partners including the UK, India, Japan, Taiwan and China, with tariff rates expected to range between 10 and 12.5 per cent.
