Court Rules the 10% General Tariff is Illegal; Expect an Appeal

Less than three months have gone by since the new section 122 tariffs were announced and the Court of International Trade has already held that these tariffs were illegal.

These tariffs were less of a burden to aviation because of the large number of exceptions that included most aircraft parts; however the Sectrion 122 tariffs excluded aviation through a list of tariff codes, and some aircraft parts tariff codes were left off of the list (like certain aircraft heat exchangers, for example).

Do I Get a Refund?

Not yet.

The Court of International Trade issued an injunction in favor of the plaintiff but not in favor of anyone else. This means that the ruling does not have nationwide effect (remember, the Supreme Court decided that nationwide injunctions were beyond the power of the federal courts). This means that generally when the United States is found to be violating the law by a federal trial court, the United States can only be prevented from further violations with respect to the named plaintiffs.

What this means in our case is that the 10% tariff remains in effect until the Court of International Trade orders a different remedy, the government decides to provide a remedy, or the appellate courts (including the Supreme Court) order a broader remedy.

While the industry waits for this to get resolved, it makes sense to retain records of the tariffs you pay for your imports, as well as the amount of duty you pay under each tariff. Effective records can make it easier for you to identify what tariffs are may have been invalidated and whether you are permitted to apply for a refund of the duties paid under the invalidated tariffs.