One year ago today — April 2, 2025 — the U.S. government announced the most sweeping tariff action in modern American history. It was called “Liberation Day,” and it imposed new tariffs on imports from virtually every country the United States trades with. Rates ranged from 10% to 50%, and they were imposed on top of whatever duties already existed.
For U.S. importers, the impact was immediate and devastating. Costs spiked overnight. Supply chains that had taken years to build were suddenly uneconomical. Purchasing decisions that made perfect sense on April 1 made no financial sense on April 3.
Now, one year later, every dollar paid under those Liberation Day tariffs is eligible for refund. The Supreme Court’s February 2026 ruling struck down all tariffs imposed under IEEPA authority — and Liberation Day tariffs were imposed entirely under IEEPA. Here’s the full story of what happened, why it matters, and what you can do about it today.
What Happened on April 2, 2025
The announcement came from the Rose Garden. The President, flanked by a large poster showing tariff rates for dozens of countries, declared that the United States would impose “reciprocal tariffs” designed to match what other countries charged on American exports. The rates were presented as a formula: if a country imposes a 40% effective tariff on U.S. goods, the U.S. would impose a 20% tariff on that country’s goods (roughly half the calculated “reciprocal” rate).
Here’s what the rates looked like for major trading partners:
| Country | Liberation Day Rate | Pre-existing IEEPA Rate | Combined IEEPA Rate |
|---|---|---|---|
| China | 34% | 20% | 54%+ |
| European Union | 20% | 0% (new) | 20% |
| Japan | 24% | 0% (new) | 24% |
| Vietnam | 46% | 0% (new) | 46% |
| Taiwan | 32% | 0% (new) | 32% |
| India | 26% | 0% (new) | 26% |
| South Korea | 25% | 0% (new) | 25% |
| Thailand | 36% | 0% (new) | 36% |
| All others (baseline) | 10% | Varies | 10%+ |
For China, the Liberation Day rate stacked on top of the IEEPA “fentanyl” tariffs that had already been in effect since February 2025. The combined IEEPA tariff load on Chinese goods eventually exceeded 60% in some categories — and that was before counting Section 301 duties, Section 232 duties, and any antidumping or countervailing duties that might also apply.
The legal basis for all of this was IEEPA — the International Emergency Economic Powers Act. The executive orders cited national emergencies related to the U.S. trade deficit. The Liberation Day tariffs were classified under HTS heading 9903.02, while the earlier fentanyl tariffs were under 9903.01.
The Rate Calculation Controversy
The “reciprocal” framing suggested a careful, country-by-country analysis of trade barriers. The reality was more blunt. Trade economists quickly pointed out that the formula didn’t actually measure tariffs or trade barriers at all — it measured the bilateral trade deficit with each country and converted it into a tariff rate.
In other words: if the U.S. imports more from a country than it exports to that country, that gap was treated as evidence of unfair trade practices, and the tariff rate was set accordingly. Countries with large trade surpluses with the U.S. got high rates. Countries with small surpluses got low rates.
This mattered legally because IEEPA requires the President to address an “unusual and extraordinary threat.” Using trade deficit math to set tariff rates looked less like an emergency response and more like standard trade policy — the kind of thing that requires Congressional authorization. This became a key argument in the legal challenges that ultimately reached the Supreme Court.
The 90-Day Pause and What Followed
The market reaction to Liberation Day was fierce. The S&P 500 dropped sharply. Supply chain disruptions cascaded through every industry. Within a week, the administration announced a 90-day pause on the country-specific reciprocal rates, dropping most countries to a baseline 10% while keeping China’s elevated rates in place.
But the pause wasn’t a repeal. It was a delay. And even the 10% “baseline” rate was an IEEPA tariff that importers were required to pay. Over the following months, the tariff landscape became a moving target:
April-July 2025: Most countries at 10% baseline. China escalating through various rate increases. Partial exemptions for certain product categories announced and sometimes reversed.
July 2025: The 90-day pause expired and full country-specific rates went back into effect for many nations, though with ongoing negotiations producing bilateral deals with some countries.
August-December 2025: A patchwork of rates, exemptions, exclusions, and deals. Some countries negotiated lower rates. Others faced escalations. Importers needed to check rates almost weekly.
January 2026: Legal challenges gaining momentum in the Court of International Trade and Federal Circuit.
February 20, 2026: The Supreme Court ruled in Learning Resources, Inc. v. Trump that IEEPA does not authorize tariffs. All IEEPA duties — both the fentanyl tariffs under 9903.01 and the Liberation Day reciprocal tariffs under 9903.02 — were struck down.
February 24, 2026: CBP stopped collecting IEEPA duties.
Every dollar collected between February 4, 2025, and February 24, 2026, is now part of the refund pool.
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The Financial Impact on U.S. Importers
The scale of Liberation Day’s impact is hard to overstate. Prior to April 2, 2025, the average effective U.S. tariff rate was approximately 2.5%. After Liberation Day, if all announced rates had remained in effect, the effective rate would have jumped to roughly 22% — the highest since the Smoot-Hawley Tariff Act of 1930.
For individual businesses, the impact depended on where they sourced and what they imported:
Small importers (under $1M annual imports): Many smaller companies importing consumer goods from Vietnam, Thailand, or China saw their landed costs jump 20-50% overnight. Margins that were already thin became negative. Some businesses simply couldn’t absorb the cost and either raised prices dramatically or stopped importing certain products altogether.
Mid-market importers ($1M-$50M): Companies with diversified supply chains faced a complex puzzle. Products from different countries carried different rates, and the constantly shifting exemptions made planning nearly impossible. Many of these importers are now sitting on six- and seven-figure refund claims.
Large importers ($50M+): Major retailers, manufacturers, and distributors saw their tariff bills increase by hundreds of millions. Some of the largest claims in the IEEPA refund pool are from companies that were importing billions of dollars in goods during the affected period.
Across all sizes, the estimated total is approximately $166 billion in IEEPA duties collected from roughly 330,000 importers of record. If you imported during this period, you’re almost certainly part of this pool — and you can verify your exposure through an Impact Assessment.
Why Liberation Day Tariffs Were Different
Tariffs aren’t new. The U.S. has used Section 301 tariffs on China since 2018. Section 232 tariffs on steel and aluminum have been in place since the same year. What made Liberation Day fundamentally different was the combination of scope, speed, and legal authority.
Scope
Previous tariff actions targeted specific countries (China) or specific products (steel, aluminum). Liberation Day tariffs covered virtually every country and every product category. There was no trading partner that escaped entirely. This wasn’t a targeted trade action — it was a comprehensive restructuring of U.S. trade policy, implemented overnight.
Speed
Section 301 tariffs took months to implement, with public comment periods, USTR investigations, and phased rollouts. Section 232 tariffs followed a similar deliberative process. Liberation Day tariffs were announced on April 2 and took effect on April 5 for the baseline rate and April 9 for country-specific rates. Three days’ notice for the most significant tariff change in a century.
Legal Authority
This is the element that ultimately mattered most. Section 301 and Section 232 are trade laws — they explicitly authorize tariff actions and prescribe processes for implementing them. IEEPA is an emergency powers law that doesn’t mention tariffs at all. The speed of implementation was actually a feature of IEEPA’s emergency framework, but it came at the cost of legal fragility.
The Supreme Court’s analysis focused squarely on this authority question. The Court didn’t rule on whether the tariffs were good policy or bad policy. It ruled that the President simply didn’t have the legal power to impose them through IEEPA, regardless of whether they might serve valid policy goals.
What the Ruling Means for Liberation Day Duties
Every Liberation Day tariff — whether it was the initial 10% baseline, the full country-specific rate, or any modified rate in between — was imposed under IEEPA authority. That means every dollar is covered by the Supreme Court ruling and eligible for refund.
This is true even if:
- Your tariff rate changed multiple times during the period (each rate was still IEEPA-based)
- You received a partial exemption or exclusion (the remaining IEEPA portion is refundable)
- Your goods also carried non-IEEPA duties like Section 301 or Section 232 (the IEEPA layer is separable and refundable)
- You passed the tariff cost to your customers (the importer of record paid the duty to CBP and is entitled to the refund)
The key is identifying which portion of your total duties paid was attributable to IEEPA. On your customs entry documents, look for duty lines referencing HTS codes 9903.01.xx or 9903.02.xx. Those are the IEEPA lines.
For importers who are new to this process, our beginner’s guide to IEEPA tariff refunds walks through the basics step by step.
The Recovery Process: Where Things Stand Now
The Supreme Court issued its ruling on February 20, 2026. The CIT followed with a March 4 order directing CBP to process refunds. But “directing” and “completing” are two different things. Here’s where the recovery process stands:
CBP is processing refunds, but slowly. The sheer volume — 330,000 importers, millions of individual entries — means CBP’s systems and staff are overwhelmed. There is no published timeline for completing all refunds.
Your recovery path depends on your entries’ status. The four recovery paths are:
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Post-Summary Correction (PSC) — for entries that haven’t been liquidated yet. Your broker files a correction through ACE, and CBP recalculates without the IEEPA duties. This is the fastest government path.
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Formal Protest — for entries that have been liquidated within the past 180 days. This is a formal challenge to CBP’s liquidation that requests reliquidation without IEEPA duties.
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CIT Litigation — for entries that are liquidated and outside the 180-day window. This requires a trade attorney and a court filing.
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Claim Assignment — for importers who want immediate capital rather than waiting for the government. You assign your validated claim to an institutional buyer in exchange for payment now.
Most importers will use a combination of paths because their entries span different liquidation statuses. An Impact Assessment maps each entry to the appropriate path.
The Deadline You Can’t Ignore
The most urgent element is the 180-day protest window. Entries that were filed in early 2025 — when the first IEEPA tariffs took effect — started liquidating around December 2025 (liquidation typically occurs about 314 days after entry). That means the earliest protest windows started closing around June 2026.
If you have entries from early-to-mid 2025 that have already been liquidated, your protest window may be open right now but closing soon. Once it closes, you lose the protest path and are left with the more expensive and time-consuming CIT litigation option.
This is why we emphasize urgency even though the ruling is already decided. The right to a refund is established — but the administrative window to claim it through the simplest channels is finite.
One Year Later: Lessons from Liberation Day
Looking back on Liberation Day from the vantage point of April 2026, several lessons stand out for importers:
Document everything. The importers who are recovering fastest are the ones who maintained clean records — entry summaries, broker statements, payment confirmations, and ACE reports. If you haven’t already, ask your broker to pull your complete IEEPA entry history now.
Understand your entry status. Not “generally” — specifically. Each entry has its own liquidation date and its own recovery path. A company with 500 entries might have 200 that are still unliquidated, 250 that are liquidated within the protest window, and 50 that are outside the window. Each group requires different action.
Don’t wait for the government to come to you. CBP is not proactively sending refund checks. The refund process requires affirmative steps by the importer or their broker. Waiting costs you both time and interest.
Know your options. The government path isn’t the only path. Claim assignment allows you to convert your refund claim into cash now, which may be the better financial decision depending on your situation. Our guide to understanding all four recovery options compares the tradeoffs.
Industry-by-Industry Impact
Liberation Day didn’t hit every industry equally. Here’s how the tariff shock played out across major importing sectors:
Consumer Electronics: Products from China, Vietnam, Taiwan, and South Korea were hit hard. The combined tariff load on Chinese electronics reached 60%+ in some categories. Companies that had diversified to Vietnam and Taiwan to avoid Section 301 tariffs suddenly found those alternatives were also tariffed under IEEPA.
Automotive Parts: The global auto supply chain spans dozens of countries. A single vehicle might contain parts from Mexico (25% IEEPA), China (50%+ IEEPA), Japan (24% IEEPA), and Germany (20% IEEPA). The cumulative impact on vehicle costs was substantial.
Retail and Consumer Goods: Clothing, footwear, furniture, toys, and household goods — overwhelmingly sourced from Asia — saw dramatic cost increases. Retailers faced the impossible choice of absorbing the tariffs (destroying margins) or passing them through (risking customer loss).
Agriculture and Food: While some agricultural products received temporary exemptions, many food imports — seafood from Vietnam, specialty products from the EU, processed foods from various countries — were subject to Liberation Day rates.
Industrial and Manufacturing Inputs: Raw materials and components imported for U.S. manufacturing — chemicals, metals, plastics, machinery parts — carried IEEPA tariffs that increased the cost of domestic production. This was the irony of the tariff regime: tariffs designed to boost U.S. manufacturing also raised the cost of inputs that U.S. manufacturers depend on.
Regardless of your industry, if you imported during the IEEPA period, your claim value is determined by the specific entries, HTS codes, and duty amounts on your customs documentation. An Impact Assessment quantifies this precisely.
What You Should Do This Week
If you imported goods into the U.S. at any point between February 4, 2025, and February 24, 2026, and you haven’t yet assessed your IEEPA exposure, the time to act is now. Not because the refund opportunity is going away — the Supreme Court ruling is final — but because the most efficient recovery paths have deadlines, and some of those deadlines are approaching.
Start by getting a clear picture of your situation: how much you’re owed, what your entries’ statuses are, and which recovery paths are available to you. Check the IEEPA tariff refund glossary if you encounter unfamiliar terms along the way.
The fastest way to get that complete picture is to request an Impact Assessment. We’ll identify every affected entry, calculate your estimated refund including statutory interest, flag any approaching deadlines, and recommend the optimal recovery strategy for your specific portfolio.
