The Supreme Court ruled 6-3 this week that Trump’s sweeping tariff program was illegal. The headlines called it a victory for American consumers. And maybe it is — in a legal sense.
But here’s what most people don’t realize: the people who spent the last year paying higher prices aren’t getting their money back. The businesses that raised those prices are.
Who Gets the Refund
When importers bring goods into the country, they pay tariffs at the border. Then they pass those costs along to retailers, who pass them to you. The Federal Reserve Bank of New York found that American businesses and consumers absorbed nearly 90% of Trump’s tariff costs in 2025.
The Court’s ruling opens the door to roughly $160 billion in refunds — but those refunds go back to the importers who paid at the border, not to the consumers who paid at the register.
Take footwear. Shoe companies paid tariffs on every container that came through customs and charged you more at checkout to cover it. Now those same companies stand to receive refund checks while your shoe prices stay exactly where they are. The Footwear Distributors and Retailers of America celebrated the ruling immediately. They should — it’s a pure margin improvement.
Why Prices Won’t Follow
I owned a gas station during Hurricane Katrina. When the storm hit, wholesale gas prices jumped almost overnight. We held off as long as we could before raising our pump prices, absorbing the difference out of our own margins. By the time we finally adjusted, the situation had started to stabilize — and then we were slow to bring prices back down because we were still making up for the losses we took at the start.
Retailers went through the same thing with tariffs. When import costs went up, many held off raising prices as long as they could, eating into their margins. Eventually they had no choice. Now that the tariffs are gone, they’re in the same spot I was — slow to come back down because they’re still recovering from what they lost on the way up.
But here’s where it gets worse. Importers paid the tariffs at the border — that’s a real cash hit. But unlike the retailer, they passed those costs straight to their customers and recovered their money through higher prices along the way. And now they’re the ones getting the $160 billion in refunds. They took a hit, got made whole through higher prices, and are now getting a refund on top of it. That’s the windfall.
For prices to come down, importers would have to voluntarily lower what they charge retailers. There’s no reason to do that until competition forces their hand. Some products — the ones where consumers are price-sensitive and options are plentiful — will eventually drift lower. But it will take time, and plenty of products will never come back down at all.
The Bottom Line
The Supreme Court did something important. It confirmed that a president can’t tax Americans without clear authorization from Congress. That matters.
But if you were hoping to see prices fall at the grocery store or the shoe store, the ruling doesn’t get you there — at least not anytime soon. The businesses that raised prices citing tariff costs have every incentive to keep them where they are. The consumers who absorbed those costs have no real mechanism to get relief. And the $160 billion in refunds flows to importers, not to you.
Equal access to the legal system doesn’t guarantee equal benefit from its outcomes.
What do you think — are there specific products where you expect prices to actually come back down? Or has the new normal already set in? I’d love to hear your thoughts in the comments.