National Economic Council Director Kevin Hassett suggested that the biggest obstacle around President Donald Trump’s global tariffs may not be legal—but logistical.
Lower courts have ruled that the administration’s so-called reciprocal tariffs, imposed under the International Emergency Economic Powers Act (IEEPA), are unlawful. The Supreme Court is expected to have the final word, and Hassett said he believes the justices will side with the White House.
Speaking on CBS News’ Face the Nation on Sunday, Hassett argued that even a loss in court wouldn’t necessarily translate into sweeping refunds.
“And I also think that if they didn’t find with us, that it’s going to be pretty unlikely that they’re going to call for widespread refunds, because it would be an administrative problem to get those refunds out to there,” he said, adding that the party who actually made the tariff payment would be first in line.
That framing cuts against Trump’s repeated insistence that foreign countries pay tariffs. In practice, U.S. importers typically pay them at the border, and many firms pass at least some of those costs on to consumers.
Hassett acknowledged that the “eventual payer” varies and said it “depends on elasticities of supply and demand,” while pointing to Chinese exporters cutting prices to offset some of the tariff impact. Still, he emphasized that refunds—if required—would likely run through importers.
“But the people who pay the tariff, if there is a refund, the people who actually paid for the good, the importer, in most cases, they’re the ones who would be the first line of defense for refunding the tariff,” he said. He argued the process would be complicated, with importers then needing to determine how any recovered money should flow back through the supply chain.
“Yes, it is a mess, and that’s why I think the Supreme Court wouldn’t do it,” Hassett added.
Trade specialists have pushed back on the idea that refunds would be unworkable, noting that the federal government already processes vast numbers of tax refunds each year.
Through late September, about $90 billion of the $174 billion in tariff revenue collected by that point reportedly came from the IEEPA duties.
Meanwhile, companies appear to be preparing for a potential refund fight. Late last month, Costco filed suit in the U.S. Court of International Trade, joining dozens of other firms challenging the IEEPA tariffs. The company argued that the uncertainty surrounding whether refunds would be guaranteed—if the Supreme Court invalidates the tariffs—left it little choice but to go to court.
Market watchers expect the justices could strike down the tariffs, particularly after arguments that reportedly signaled skepticism toward the administration’s position.
Even so, a Supreme Court ruling would not wipe out all U.S. tariffs. Other levies imposed under separate statutes would remain in place, and the administration could attempt to replace the IEEPA duties with new tariffs under different legal authorities.
In a recent interview with The Wall Street Journal, Trump suggested those alternatives would be slower to deploy.
“I can do other things, but it’s not as fast. It’s not as good for national security,” he said.
