UPS and FedEx to return $5B in tariff refunds after U.S. Customs opens CAPE refund portal

UPS and FedEx said on April 28 they will return tariff refunds to customers as U.S. Customs starts paying back duties collected under invalidated emergency tariffs. (reuters.com) The refunds cover duties imposed under the International Emergency Economic Powers Act, or IEEPA, which the U.S. Supreme Court struck down in February. U.S. Customs and Border Protection launched the first phase of its CAPE refund system on April 20. (reuters.com) (cbp.gov) UPS chief executive Carol Tomé said the company had collected about $5 billion in those tariffs from customers and plans to send the money back once Treasury remits it. On UPS’s earnings call, she said the carrier was applying for just under $500 million in the first wave, covering 2.5 million entities. (reuters.com) (wwd.com) FedEx said its process is similar: if Customs refunds FedEx, FedEx will refund the shippers and consumers who paid the charges. The company also said it would generate reports needed to secure refunds for customers. (cnbc.com) The key gatekeeper is the importer of record, the party Customs recognizes as responsible for the entry. CBP says only the importer of record or an authorized customs broker can file a CAPE declaration. (cbp.gov) That matters because many shoppers and smaller businesses paid tariff bills to carriers at delivery, but they cannot always claim directly from the government. When UPS or FedEx acted as importer of record, the refund first goes to the carrier, which then has to match the payment back to the original payer. (ups.com) (cnbc.com) CBP is processing refunds in phases rather than all at once. Phase 1 covers certain unliquidated entries and certain entries within 80 days of liquidation, and each CAPE declaration can include up to 9,999 entries. (cbp.gov) UPS says customers do not need to contact the company for shipments where UPS was the importer of record. But UPS also says Customs has told carriers to expect at least 60 to 90 days before approved refunds reach importers of record. (ups.com) Reuters reported that about $166 billion in U.S. tariff collections could be subject to refunds after the court ruling. The carveout is important: CNBC noted that Section 232 and Section 301 tariffs remain in place, so not every import duty paid in the last year is coming back. (reuters.com) (cnbc.com) For carriers, the tariff fight is now a bookkeeping job as much as a legal one. The money may be owed by Washington, but the last mile runs through UPS and FedEx systems that have to identify who paid, when, and how to return it. (cbp.gov) (ups.com)