Tariff refunds may be coming — but uncertainty remains for small businesses

As businesses continue to claim refunds on tariffs that were deemed illegal by the Supreme Court, U.S. Customs and Border Protection says businesses could start seeing refunds as soon as May 12.

Up ⁠to $166 billion of tariffs imposed ​under the International Emergency Economic ​Powers ⁠Act are subject to CBP refunds. But for many small importers, the process is anything but straightforward — with uncertainty around timing, paperwork, and what costs won’t be reimbursed.

To see how that’s playing out on the ground, “Marketplace Morning Report” host Sabri Ben-Achour spoke with Rachel Rozner, owner and founder of Elden Street Tea Shop in Reston, Virginia. The following is an edited transcript of their conversation.

Sabri Ben-Achour: You sell tea. There are not a lot of places you can grow tea in the U.S., so you’ve got to import. How disruptive — remind everyone — were the tariffs for you last year?

Rachel Rozner: The tariffs were very disruptive. This is the first time ever that a full tariff on tea had ever been in existence. And so it was very impactful because we get 100% of our tea from overseas, especially if you’re wanting more specific kinds of teas, different varietals, you can only get that overseas in specific regions around the world. And so with the global tariffs it was very impactful for our business.

Sabri Ben-Achour: Last time we talked, you were mulling over whether it would be possible or worthwhile to try and get a refund on tariffs. Where did you end up landing on that?

Rachel Rozner: We are still mulling it over. We have begun looking at the process. It is a lot of headache, and it is a lot of uncertainty. I have a couple of other business owner acquaintances who have gone through the process who have said that the process online has been fairly streamlined and easy. However, they really haven't had any communication since they filled out the application, so they're kind of in limbo. They don't know what they're going to be getting. They don't know when they're going to be getting it, and so they just kind of feel like it was for nothing.

Ben-Achour: At this point, some businesses had to take out loans to pay for tariffs or front-load imports, so they owe interest, or they had to pay consultants to help them figure out their supply chains. These are costs that are not going to get refunded with tariffs — which is a long way of asking, do refunds or eventual lower prices for you mean you can lower prices for your customers?

Rozner: Yes, I will definitely say, just to continue with your last question, that also the shipping situation with the gas prices has not lowered our costs either. So that's like added on right now to what we had to pay in tariffs, plus extra shipping costs for getting tea here. And so it's all playing into each other. We did have to take out a loan, a small loan, to cover some of the tariff costs, and yeah, that is not covered through the refund process, and we still have to pay that back.

Digging into tariff refunds

• From May 4: Consumers helped pay for tariffs. Will they get refunds?

• From April 23: Businesses have started applying to get their share of $166 billion in tariff refunds

• From April 15: How small businesses are preparing for tariff refunds