U.S. Customs and Border Protection (CBP) will officially stop collecting billions in trade duties at 12:01 a.m. EST on Tuesday, following a landmark Supreme Court ruling that declared President Donald Trump’s use of emergency powers to levy tariffs illegal.
The agency notified shippers Monday via its Cargo Systems Messaging Service that it will deactivate all tariff codes linked to the International Emergency Economic Powers Act (IEEPA), ending a three-day period of administrative limbo where duties continued to be collected despite the high court’s Friday decision.
The cessation of the IEEPA duties coincides with a rapid-fire escalation in the administration’s trade policy.
Within 24 hours of the court’s 6-3 rebuke, President Trump announced a new 15% global tariff—upped from an initial 10% proposal—invoking Section 122 of the Trade Act of 1974.
This rarely used "Balance of Payments" authority allows the executive to impose temporary surcharges of up to 15% for 150 days without prior congressional approval, effectively replacing the struck-down reciprocal and drug-enforcement duties with a broader, uniform levy.
The transition leaves American importers facing a potential $175 billion refund battle.
While the Supreme Court invalidated the legal basis for the IEEPA collections, the CBP’s latest message notably omitted any guidance on how, or if, businesses will be reimbursed for the $500 million in daily revenue generated by the now-defunct codes.
Legal experts suggest the administration may attempt to shield the Treasury from a massive cash drain by arguing that the new Section 122 duties should apply retroactively or by challenging the mechanics of the refund process in lower courts.