Lawmakers Are Worried Small Businesses Will Get Left Behind in Trump’s Tariff Refund System

Small businesses that paid President Donald Trump’s tariffs have been largely left to fend for themselves as they navigate the administration’s refund system.

In Washington, the lawmakers calling for small businesses to be first in line to receive their share of the $166 billion paid in tariffs, say that, for the most part, their hands are tied.

“I’m fighting for that to happen, but most of it’s going to end up playing out in court, but it really matters to our small businesses in particular,” Wisconsin Sen. Tammy Baldwin said.

Baldwin said she met with the owners of a local textile company that laid off staff to afford tariffs on imported fabric — and now they wonder if they’ll get their money back.

In Wisconsin, importers paid $3.5 billion in tariffs from March to December 2025, according to the small business coalition We Pay The Tariffs. More than a dozen Wisconsin companies have sued the Trump administration for tariff refunds.

U.S. Customs and Border Patrol is currently updating its duty payment processing system to issue refunds at scale. Officials must review more than 53 million entries filed by importers that include emergency tariff payments.

The development of the CBP system’s new functions to receive, process and refund these duties was mostly complete as of last week, according to court filings.

Once the process is set, it becomes a question of who has the resources and know-how to navigate CBP’s refund system. The Trump administration is requiring business owners to file their own claims.

CBP’s updated system will require importers to file a declaration detailing their payments of tariffs under the International Emergency Economic Powers Act, according to an affidavit filed in trade court earlier this month.

“It’s incumbent on smaller importers to do what they need to do to get their money,” said Chris Duncan, a former CBP attorney who currently works as a tariffs and customs lawyer.

Sen. Ed Markey, the ranking member of the Small Business Committee, said that puts small businesses at a disadvantage.

“Small businesses do not have teams of legal and financial experts to submit their forms. Small businesses do not have the time to navigate this convoluted system,” Markey said in a call with business owners last week. “Small businesses need their refunds, and they need them now.”

Markey and 19 other Democratic senators sent a letter to CBP Commissioner Rodney Scott on Friday demanding the agency automatically refund IEEPA tariffs through its existing system rather than the updated one.

“There is no principled reason for the Trump administration to conduct the refund process this way,” reads the letter, reviewed by NOTUS. “CBP already has the payment records it needs to issue refunds.”

Markey — along with Sens. Ron Wyden and Jeanne Shaheen — also introduced a bill that would require CBP to issue full tariff refunds with interest and prioritize returning money to small businesses.

Without buy-in from Republicans, however, Democratic senators say it will be up to the local communities to pressure the federal government.

“What is going to be most helpful is to create enough pressure in communities, particularly small communities,” Wyden, the top Democrat on the Senate Finance Committee, said.

Rep. Mark Pocan, another Wisconsin Democrat, expressed concern about the “dysfunction” that could arise from companies trying to navigate the intricacies of the CBP’s refund system, as well as for consumers who shouldered price increases.

“Bottom line is, we never should have done illegal tariffs to begin with. Congress should have stood up, as Democrats had asked for, for our constitutional authority around tariffs, and now we’re going to wind up creating all kinds of dysfunction for businesses and individuals,” Pocan said.

Following the Supreme Court’s 6-3 ruling striking down his emergency tariffs in February, Trump said he will continue his tariff agenda using alternative legal authorities and imposed a 15% global tariff, which Congress must vote to extend later this year.

Trump allies in Congress say the president’s tariffs, which are unpopular among voters, are short-term pain for the long-term gain of balancing the U.S.’s trade relationships and attracting foreign investment.

Nevertheless, when asked if tariff refunds should be passed on to consumers, Rep. Scott Fitzgerald expressed openness to the idea.

“If it’s something that they could actually draw, like a clear line or a bright line. You know, we had a lot of companies where the tariffs had a direct effect on aluminum out of Canada or textiles out of Vietnam, or — you know, it was all part of the manufacturing process,” Fitzgerald said.

“So I’m not sure how that would shake out either, if it was one element of a larger manufacturing versus, like, a straight retailer who was selling some type of consumer goods.”