UPS and FedEx Have Begun Applying for Partial Tariff Refunds
The tariff refund process has begun, but consumers may have to wait several months to actually benefit. The U.S. Customs and Border Protection (CBP) opened a refund channel on Monday, allowing businesses to begin applying for refunds after the U.S. Supreme Court ruled certain tariffs unconstitutional.
February 22, 2022, FedEx and UPS delivery trucks on Krakowska Street in Krakow, Poland.
The refund process only applies to tariffs collected under the International Emergency Economic Powers Act (IEEPA), the specific tariffs the Supreme Court declared invalid. Tariffs collected under other laws – such as Section 232 of the Trade Expansion Act of 1962 or Section 301 of the Trade Act of 1974 – remain in effect.
This tariff refund portal, called the Consolidated Application Processing and Entry System (CAPE), will allow Importers of Record (IOR) to submit refund applications. U.S. Customs will process these applications in phases, with the first phase covering only goods for which customs clearance was completed within the past 80 days.
For shippers UPS and FedEx, this means the company and ultimately their customers are poised to receive a payout.
UPS said this week that it will file and collect tariff refunds from U.S. Customs on behalf of customers for all shipments where the company serves as the Importer of Record, and customers do not need to contact UPS proactively.
However, the company noted that refunds could take up to three months to be disbursed to UPS, after which the company can distribute the refunds to customers.
“We are always committed to keeping goods moving and helping our customers fully exercise their rights in this complex process,” UPS said in a statement. “We are closely monitoring legal developments and will share updates as they become available.”
The shipper said it has only received guidance from U.S. Customs regarding the first phase of refunds so far.
FedEx also confirmed to CNBC that it has begun submitting tariff refund applications to U.S. Customs.
“Supporting customers as they navigate regulatory adjustments remains our top priority,” FedEx said in a statement.
The company said its process is “straightforward”: if U.S. Customs issues a refund to FedEx, the company will pass it on to the shippers and consumers who paid the associated fees.
FedEx also said it will generate the various reports needed to apply for refunds on behalf of customers.
On Tuesday, former President Donald Trump said on CNBC’s “Squawk Box” that he would “remember” any companies that don’t apply for tariff refunds.