Importers and their brokers will be able to begin claiming refunds through an online portal beginning at 8 a.m., according to U.S. Customs and Border Protection, the agency administering the system.
Companies must submit declarations listing the goods on which they collectively put billions of dollars toward the import taxes the court subsequently struck down. If CBP approves a claim, it will take 60-90 days for a refund to be issued, the agency said.
The government expects to process refunds in phases, however, focusing first on more recent tariff payments. Any number of technical factors and procedural issues could delay an importer’s application, so any reimbursements businesses plan to make to customers likely would trickled down slowly.
Not all of those orders qualify for the first phase of the refund system’s rollout, which is limited to cases in which tariffs were estimated but not finalized or within 80 days of a final accounting.
Meghann Supino, a partner at Ice Miller, said the law firm has advised clients to carefully list in their declarations all of the document numbers for forms that went to CBP to describe imported goods and their value.
“If there is an entry on that file that does not qualify, it may cause the entire entry to be rejected or that line item might be rejected by Customs,” she said.
Supino thinks the portal going live will require composure as well as diligence.
“Like any electronic online program that goes live with a lot of interest, I would expect that there might be some hiccups with the program on Monday,” she said. “So we continue to ask everyone to be patient, because we think that patience will pay off.”
Nghi Huynh, the partner-in-charge of transfer pricing at accounting and consulting firm Armanino, said most companies claiming refunds will have imported a mix of items, and not all will qualify right away.
“It’s about having a clear process in place and keeping track of what’s been submitted and what’s been paid, so nothing falls through the cracks,” she said. “Each file can include thousands of entries, but accuracy is critical, as submissions can be rejected if formatting or data is incorrect.”
Small businesses have eagerly awaited the chance to apply for refunds. Brad Jackson, co-founder of After Action Cigars in Rochester, Minnesota, said he starting compiling records and preparing to enter information into the system the minute CPB announced the launch date.
The company imports cigars and accessories from Nicaragua and the Dominican Republic. Last year, it paid $34,000 in tariffs and absorbed much of the cost instead of raising customer prices, Jackson said.
Last spring, he had a two-week delay in a shipment due to a missing document, so he is being more careful with refund documents, he said.
“My main concern is the turnaround time,” Jackson said. “A refund process that takes several months to complete doesn’t solve the cash flow problem that it is supposed to fix.”
“Supporting our customers as they navigate regulatory changes remains our top priority,” FedEx said in a statement. “We are working with our customers as CBP begins processing refunds and plan to begin filing claims on April 20.”
