Small Businesses Weigh Cost of Tariff Refunds Against Administrative Burden

Small U.S. businesses importing goods subject to Section 301 tariffs are increasingly reluctant to pursue refunds, despite eligibility. The U.S. government has authorized refunds for certain products like electronics, machinery, and components originally targeted under China-related tariffs, but the application process demands extensive record-keeping, legal review, and submission to U.S. Customs and Border Protection. The average time to process a refund request exceeds 18 months, and businesses often spend between $15,000 and $30,000 in legal and administrative fees. For a refund of $25,000—representing just 10% of the initial tariff paid—many companies conclude the net gain is negligible. One electronics assembler in Ohio reported a $28,000 refund after investing $22,000 in compliance, resulting in a net gain of only $6,000 after fees. The issue is concentrated among firms with annual import volumes below $5 million. Larger firms with dedicated trade compliance teams are more likely to file, while smaller entities, particularly in manufacturing and retail, often abandon the process. The administrative complexity is compounded by evolving guidance from U.S. Trade Representative (USTR) offices and inconsistent rulings across CBP field offices. Despite the inefficiencies, the program remains active. As of early 2026, over 7,200 refund applications had been submitted, with roughly 43% approved and 29% still pending. The USTR has acknowledged the burden but has not streamlined the process. Meanwhile, volatility in global supply chains and persistent inflation pressures keep tariff-related costs front-of-mind for small importers.