Last year, Sandra Alonso needed a new powered wheelchair to get around her city of Tampa, Fla., after wearing out her old one.So she ordered the same model because she knew she could easily fold it and lift it without anyone's help."It's just the perfect chair for me," she said.Unfortunately for Alonso, the chair is made in China, and when she bought it last year, tariffs on Chinese goods were a sky-high 145%.She paid an extra $3,500."There's no reason I had to pay double for this chair," Alonso said.
"The federal government should give me my money back."Alonso thought she should get the refund after the Supreme Court in February ruled that many of President Trump's tariffs were illegal, leading to the federal government having to refund more than $160 billion that it had collected.The thing, however, is that the federal government can't give her that money back.That's because it is instead returning the cash to the importers that directly paid those tariff fees, typically American businesses.Sign up for the Planet Money newsletter.
The world is confusing.Economics can help. Those companies passed on some of the extra cost to customers, usually in the form of higher prices.
But few are stepping up to share the refunds."It's all just a giant transfer from consumers to corporations," said Michael Ettlinger, a senior fellow at the Institute on Taxation and Economic Policy."You can't really design a worse tax than that."Alonso is actually lucky — she imported her chair through UPS, which told her in an email that her refund is in the works.
The company said it can take up to 90 days to get the cash to customers after the company receives it from U.S.Customs and Border Protection.In fact, UPS, FedEx and DHL have all pledged to pass along refunds they get from the government to customers.Part of the reason for that is shippers explicitly charged customers tariff fees — if the federal government charged FedEx $100 to import your package, FedEx then billed you $10...