Delayed tariff refunds could add $700 million monthly to U.S. bill

Every month the U.S. delays refunding tariffs that the Supreme Court invalidated, taxpayers may face roughly $700 million in extra interest, the Cato Institute calculates, adding about $23 million to the bill each day. The sum reflects interest that federal filings show the government acknowledges it will owe importers for duties collected under the International Emergency Economic Powers Act.

The legal trigger was the Supreme Court decision on Feb. 20 that blocked the president from imposing tariffs under IEEPA. In response, importers and retailers pressed for prompt repayment, while the Department of Justice requested court pauses to slow the refund process. Cato says the administration sought a 120-plus-day delay; those days of accrued interest would cost taxpayers almost $3 billion, the institute calculates. Cato added an update to its analysis reporting that the Court of Appeals for the Federal Circuit rejected the administration’s delay request as the post was being published, and Newsweek similarly reported the CAFC blocked the stay.

Cato’s $700 million per month figure uses a conservative, uniform assumption. "Conservatively using the lower rate for all entries, we calculate in Figure 1 that $700 million in interest is added to the final bill every month that the government delays tariff refunds, or around $23 million per day," the institute wrote. Its method applies the lower federal overpayment rate, 4.5 percent annualized, even though regulations call for daily compounding at 4.5 percent for large overpayments and 6 percent for smaller ones. Newsweek summarized the analysis by saying interest appears to be compounding on an estimated $175 billion owed to importers, a base that translates to roughly $20 million per day and $700 million per month.

Cato framed the trade-off in stark budgetary terms. "Thus, for example, the 120-plus-day delay the government just requested would cost taxpayers almost $3 billion in additional interest. And if the government were to drag out refund lawsuits until the end of the president’s term, as he recently suggested, taxpayers would owe importers about $25 billion more. (For context, that’s almost the annual budget of NASA.)," the institute wrote. Cato argued the Justice Department should stop trying to slow the process: "In our opinion, it’s not worth the Justice Department’s time and resources to fight IEEPA tariff refunds that the government has already promised, but it’s certainly not worth another $23 million a day to American taxpayers."

The dispute has wider economic and community implications. Lawmakers and committees have pointed to the scale of tariff payments: the Minority Joint Economic Committee reported that between February 2025 and January 2026 consumers paid more than $231 billion in tariff costs, or roughly $1,745 per family, a figure cited by The Mirror. Retailers and import-dependent businesses, including Costco among others, have pressed for refunds and signaled willingness to litigate until they are paid.

Administration officials acknowledge the fight could be protracted. Newsweek reports President Trump said the government would "end up being in court for the next five years" when asked about refund litigation. With courts already pushing back on delay requests, interest is continuing to accrue on sums the government may owe, turning a legal contest into a potential long-running fiscal liability for taxpayers and a direct financial strain on consumers and businesses awaiting reimbursement.