Old Tariffs, New Tariffs, Future Tariffs

Old Tariffs, New Tariffs, Future Tariffs – Your Guide to Uncertainty.

Within a single 24‑hour window on February 20, 2026, the trade landscape changed dramatically:

• The U.S. Supreme Court struck down the IEEPA tariffs as unlawful.
• The President imposed a new global tariff (starting at 10%, quickly raised to 15%) under Section 122.
• New Section 301 investigations were announced—hinting at more long‑term tariffs ahead.

Here’s what all of this means for Wisconsin’s small businesses that import, manufacture, or rely on global supply chains.

1. The Supreme Court’s IEEPA Decision: What Actually Happened

The Court ruled that the International Emergency Economic Powers Act (IEEPA) does not give the president the authority to impose tariffs. As a result, all of the prior IEEPA-based tariffs—including “fentanyl tariffs” and “reciprocal tariffs”—were immediately invalidated.

The Court’s reasoning came through two concurring opinions:

• Opinion #1 (Kagan, Sotomayor, Jackson)

IEEPA’s authority to “regulate” imports does not include the power to tax them via tariffs.

• Opinion #2 (Roberts, Gorsuch, Barrett)

Under the major questions doctrine, Congress—not the President—must clearly authorize actions of major political and economic significance, especially when they involve taxation.

Shortly after the ruling, the Administration issued an Executive Order confirming IEEPA tariffs would be ended “as soon as practicable.”

2. Refunds: Will Importers Get Their Money Back?

This is the billion‑dollar question—and the Supreme Court didn’t answer it.

The Administration has stated that resolving refunds could take years, given the complexity. Still, importers should act immediately. Unless Congress passes specific refund legislation:

• Only importers of record can legally file refund claims.
• Businesses that reimbursed importers for IEEPA tariff costs should contact those importers now to ensure any eventual refunds are properly passed back.
• Refund options depend on liquidation status:
  • Unliquidated Entries
    • Wisconsin companies should file a Post Summary Correction (PSC) now to remove the IEEPA tariff lines.
    • CBP should liquidate without the tariff and issue refunds.
    • Importers can request liquidation extensions if needed.
  • Liquidated Within the Last 180 Days
    • Wisconsin companies file a protest asking for reliquidation without the tariff.
    • If denied, importers can appeal to the U.S. Court of International Trade (CIT).
• Liquidated More Than 180 Days Ago
  • Importers must file directly with the CIT.

The government has previously indicated it would not oppose reliquidation for these entries if the tariffs were found unlawful, which they now have been.

3. The New Section 122 Global Tariff (15%): What’s Covered?

Just hours after the IEEPA ruling, the President announced a new global tariff under Section 122 of the Trade Act of 1974:

• Began as 10%, then raised to 15%
• Became effective February 24, 2026
• Defined as temporary—150 days only (scheduled to expire July 24, 2026), unless extended by Congress

Key Exemptions

Goods NOT subject to the Section 122 tariff include:

• Items listed in Annexes I & II (agriculture, autos, pharmaceuticals, critical minerals, and certain electronics)
• USMCA-compliant goods from Canada and Mexico
• DR‑CAFTA qualifying textiles and apparel
• Goods already subject to Section 232 (though non‑metal components are subject to Section 122)
• Goods loaded onto a vessel before Feb. 24 and entered before Feb. 28, 2026 (“in‑transit” exception)
• Most Chapter 98 goods, except items under heading 9802 (which will still be dutiable on the value of repairs or alterations)

Foreign Trade Zones

Placing goods into a Foreign Trade Zone (FTZ) does not avoid these tariffs.

The proclamation gives these goods “privileged foreign” status, locking in the 15% duty rate at admission.

Bonded warehouses, however, do not carry this restriction.

4. More Tariffs Coming? Almost Certainly.

The Section 122 tariff is a stopgap—essentially buying time while longer‑term tools are prepared. The Administration is already pursuing:

• Section 301 (Trade Act of 1974)

New investigations launched. These typically take months and often result in country‑specific retaliatory tariffs.

• Section 338 (Tariff Act of 1930)

Allows the President to impose up to 50% tariffs on countries discriminating against U.S. commerce.

No hearings required—could be implemented quickly.

No president has ever used it.

• Section 232 (Trade Expansion Act of 1962)

Tariffs permitted on national security grounds after an investigation by the Commerce Department.

5. What Wisconsin Businesses Should Expect and Do Now

Regardless of the political landscape or midterm outcomes:

Tariffs are likely to remain in place through at least the end of the current presidential term.

Even if Section 122 expires on July 24, 2026, other authorities (301, 232, 338) may take its place.

Expect “gap periods” where tariffs may temporarily lapse—creating opportunities for businesses to:

• Stage inventory in customs‑bonded U.S. warehouses, or
• Store goods in Canadian or Mexican bonded warehouses and import during low‑tariff windows.

Bottom Line

The tariff environment has changed—again—and Wisconsin’s importers must move quickly to:

• Review entries for refund opportunities
• File PSCs or protests as appropriate
• Adjust pricing and sourcing for the new 15% global tariff
• Monitor upcoming Section 301, 232, and 338 actions
• Prepare strategically for transitional tariff periods

In the meantime, SBDC’s Go Global Initiative will keep an eye on the situation and offer updates.  If you are looking for assistance with import tariff mitigation strategies, support or any other international trade topic, please connect with us!