Tariff refunds now outrun collections, and net customs revenue has gone negative

Tariff refunds have outrun tariff collections for two consecutive months, according to a Tax Foundation report drawing on monthly Treasury statements: $21.97 billion refunded in May against $21.93 billion collected, then $49.18 billion refunded in June against $23.63 billion collected, for net customs revenue of negative $25.56 billion in June ^[1][3]. That inverts the fiscal argument for the regime, which Tax Foundation vice president of federal tax policy Erica York notes was sold as a way to cut the federal deficit and offset tax cuts from the One Big Beautiful Bill Act ^[12].

The mechanics are not complicated. The government collected $166 billion under the International Emergency Economic Powers Act before the Supreme Court struck those levies down in February, leaving it owing money back to as many as 330,000 importers ^[5][6]. When Customs and Border Protection opened its online refund portal in May, a roughly $2 billion April refund month became a $21.97 billion one, about eleven times larger ^[2][3]. June's payouts ran at about 2.1 times collections ^[2]. Across the two months the Treasury pushed out $71.15 billion and took in $45.56 billion, a net drain of $25.59 billion ^[4].

About $100 billion has gone out since May, roughly 60 percent of the IEEPA total ^[8][5]. The Tax Foundation expects the remaining $66 billion to move more slowly, because the next phase involves more complex claims filed after the established liquidation period, which raises procedural questions ^[9]. Slower is not cheaper. Undisbursed refunds accrue interest at up to 4.5 percent on overpayments of $10,000 or more and 6 percent on smaller ones, according to the Cato Institute ^[10]. Applying the lower rate to the full outstanding balance gives roughly $3 billion a year in interest that taxpayers carry while the money sits ^[6].

Tariff revenue is a small share of total federal receipts, so the line item alone does not move the budget ^[17]. The cost sits in the behaviour around it. York told Fortune that the administration's talk of fixing the fiscal situation with tariffs "really mismatches what we're seeing play out in the data, which is that they have relied on really shaky legal grounds to try to impose these tariffs" ^[11]. She counts more than 50 changes to tariff policy since January 2025, the most recent a three-day pause on a proposed 50 percent tax on Canadian imports while the two countries negotiate ^[14][15]. The Federal Reserve Bank of St. Louis found the levies raised prices for pharmaceuticals and household utensils by more than 4 percent over the past year ^[13]. The Tax Foundation's summary is that importers get relief but "the economic damage from the chaotic tariff regime cannot be refunded" ^[4].

York expects tariff revenues to turn positive again within months ^[16]. For operators, three things matter more than the monthly headline. First, the pace at which the remaining $66 billion clears, since post-liquidation claims determine whether a refund you are owed lands this quarter or next year ^[9]. Second, whether duties rebuilt under Sections 122, 232 and 301 of the 1974 Trade Act collect enough to replace the IEEPA base, which so far they have not ^[7]. Third, the interest meter, which is the only part of this that compounds in the importer's favour ^[10].