JPMorgan Chase is warning that the US government could face up to $200 billion in tariff refunds after a major Supreme Court ruling struck down key emergency trade duties imposed by Donald Trump.
In a new research note, the bank said businesses may seek between $150 billion and $200 billion in repayments if lower courts rule that companies must be reimbursed for tariffs collected under the International Emergency Economic Powers Act (IEEPA).
The Supreme Court ruled that the president did not have the authority to impose certain country-based tariffs under that law.
"The Court's ruling remanded this issue to the lower courts, so we won't know the full amount or timing of any rebates," wrote Michael Feroli, one of the bank's top economists, NY Post reported.
He added that official customs data may be outdated, but JPMorgan estimates "the amount at stake to be around $150–200 billion."
That sum equals roughly 16% to 22% of the projected $901 billion US defense budget for 2026. According to the Penn Wharton Budget Model, refund claims could total as much as $165 billion.
Trump admin could be forced to refund $200B in tariffs after SCOTUS ruling: JPMorgan https://t.co/gTt69pf89J pic.twitter.com/sjjD8xlUhI
— NY Post Business (@nypostbiz) February 20, 2026
Trump Tariff Refund Fight Could Drag On for Years
The ruling leaves the question of refunds unresolved, meaning it could take months or even years to settle.
President Trump acknowledged the uncertainty, saying, "What happens to all the money we took in? It wasn't discussed. I guess it has to get litigated for the next two years."
Currently, there is no system in place for companies to request or receive tariff refunds. Economists say businesses would likely have to file lawsuits or claims individually.
According to CBS News, more than 1,000 refund cases have already been filed with the Court of International Trade, and experts expect that number to rise.
JPMorgan also warned that even if refunds are paid, new tariffs may quickly replace the old ones.
Treasury Secretary Scott Bessent said the administration could "recreate the exact tariff structure" using other legal tools. Commerce Secretary Howard Lutnick added that "tariffs are here to stay."
Feroli noted that even if average tariff rates fall—from 9.4% in December to just over 4% without the IEEPA duties—ongoing changes could create "a material increase in trade policy uncertainty."
In simple terms, that means businesses may feel unsure about future rules, which can slow spending and hiring.
The bank also cautioned that refund payments and policy shifts could widen the federal deficit in 2026.
Originally published on vcpost.com
