Apr 17 (Reuters) – Jay Foreman said he is ‘prepared’ for the U.S. government’s launch on Monday of a new system for refunding up to $166 billion in illegally collected tariffs, but he and many other importers are aware that a lot can still go wrong.
“You have to worry about what they might do to disrupt things,” said the chief executive of toymaker Basic Fun, which sells Tonka trucks, Care Bears and K’Nex construction toys.
The refund system is the latest twist in a long-running battle over trade tariffs levied last year as part of U.S. President Donald Trump’s effort to restructure U.S. trade relations with nearly every country in the world. Ever-changing tariffs have roiled global business as companies raced to change supply chains to avoid them, and also to figure out who would pay them.
In February, the United States Supreme Court struck down tariffs that Trump sought to impose under a law intended to be used in national emergencies, handing the Republican president a resounding defeat.
In a court filing Tuesday, U.S. Customs and Border Protection said it had completed development of the initial phase of the refund system, known as CAPE. The system will consolidate refunds so that importers receive one electronic payment, with interest where applicable, rather than processing refunds on an entry-by-entry basis. Critics of Trump’s tariffs have pushed for a streamlined process.
Customs authorities reported that, as of April 9, approximately 56,497 importers had completed the necessary steps to receive electronic refunds, a total value of US$127 billion, or more than three-quarters of the total eligible for refunds. More than 330,000 importers paid the tariffs in question on 53 million shipments of imported goods, according to court records.
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Matt Field, chief financial officer of heavy-duty truck maker Oshkosh, is one of them. The Wisconsin-based manufacturer doesn’t disclose how much it paid in emergency tariffs, but Field said it’s an “impactful” amount. ‘I’m a chief financial officer, so I chase every dollar,’ he said.
Field said he is prepared to request a refund as soon as the customs portal opens, but can wait for the ‘system to settle down’.
Several importers contacted by Reuters said they were concerned about the durability of the new system, at least in the initial phase, as thousands rush to upload their orders.
“It’s not like Taylor Swift tickets are going to go on sale,” said Basic Fun chief executive Foreman, who is seeking $7 million in refunds. However, with so many companies seeking a refund at the same time, “there’s no telling if the portal will crash.”
There are many potential logistical glitches. Jason Cheung, chief executive of Huntar Co., a US-based toymaker with a factory in China, said: ‘It will be nice to get the money back’, but added: ‘it seems like the government is trying to make things difficult’.
Cheung noted that registration requires entering bank account information, although the government already has it for customs payments. And company names must be accurate. ‘It took me five tries to get the registration due to small differences such as ‘company’ or ‘co,” said Cheung.
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Still, he said, “we’re very used to filling out forms” and have “no concerns” about getting a successful refund.
That sentiment was shared by Rick Woldenberg, chief executive of educational toy maker Learning Resources, one of the main plaintiffs in the lawsuit that led to the tariffs’ end.
‘Of course there are difficulties, but I’m pleased to see the government do the right thing,’ said Woldenberg, whose company is seeking more than $10 million.
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