US seeks to keep collecting tariffs

Tariffs are back in the courts again, and the immediate result is simple: importers still have to pay. After the U.S. Court of International Trade ruled on May 7 that Trump’s 10% global tariff was unlawful, the administration moved fast to keep the money flowing during the appeal. By May 13, that effort had worked, at least for now — the duties stay in place while the case moves up. ### Which tariff is this? This is Trump’s fallback tariff — a 10% global import surcharge he imposed in February 2026 under Section 122 of the Trade Act of 1974, right after the Supreme Court knocked out his broader tariffs that had relied on emergency powers. Section 122 is narrower. It allows a temporary surcharge, capped at 15%, for balance-of-payments problems, and it expires after 150 days unless Congress extends it. (politico.com) ### Why did the trade court strike it down? The trade court’s majority said the administration used the wrong legal hook. Basically, Section 122 is about a specific kind of international-payments problem, and the judges said Trump’s proclamation pointed instead to trade and investment deficits that do not satisfy that statute. The panel split 2-1, and the ruling called the tariff unauthorized by law. (dorsey.com) ### If the court ruled against it, why are companies still paying? Because the first ruling was narrower than it sounded. The Court of International Trade did not shut the tariff down nationwide. It blocked collection only for the plaintiffs with standing — Washington state, toy company Basic Fun, and spice importer Burlap & Barrel. For almost everyone else, the tariff kept running anyway, and now the appeals process has frozen even that limited relief for the moment. (politico.com) ### What changed this week? The administration asked for a stay on May 11 so the lower-court ruling would not take effect while the appeal proceeds. Then the court granted that request, which means the government can keep collecting the Section 122 tariffs during the fight. So the headline is not that Trump won the case. He did not. The headline is that he won time — and time matters when customs is collecting cash at the border every day. (politico.com) ### Are refunds happening anyway? Yes, but that is from the earlier Supreme Court fight over a different set of tariffs. Companies started receiving those refunds on May 12. Oshkosh said payments had begun, and Basic Fun said the first money it saw covered only about 5% of its claim. Customs said it expected to pay $35.46 billion across 8.3 million shipments as of May 11. (usnews.com) ### Why are state officials upset? Because the refund system mostly pays back the businesses that directly remitted the tariffs, not the households that absorbed higher prices. Treasurers and other state fiscal officials from eight states said that creates a transparency and fairness problem. Their point is pretty intuitive — if tariff costs were passed through to shoppers, refunding only importers does not unwind the real economic hit. (cnbc.com) ### What is the real stakes question now? The legal question is whether Section 122 can support this tariff at all. But the practical question is who holds the money while judges decide. Right now, that answer is still the federal government. And that keeps the pressure on importers’ cash flow, pricing, and supply-chain planning even before the appeals court reaches the merits. (forbes.com) ### Bottom line? This is a fight over a temporary tariff that may not survive, but it can still do plenty of economic damage while the case drags on. That is the catch — even a tariff judges may eventually kill can keep shaping prices and business decisions in the meantime. (dorsey.com) (usnews.com)