Retailers are navigating not just a new tariff regime, but uncertainty about what that regime actually entails. As of Tuesday, the Trump administration’s reworked global tariff took effect at 10 percent, despite the president’s earlier statements that it would begin at 15 percent. U.S. Customs and Border Protection notified importers hours before implementation that the rate would start at 10 percent for 150 days unless specifically exempt, while the White House indicated that a separate order would be required to formally increase it to 15 percent.
On February 20, the Supreme Court held that the International Emergency Economic Powers Act (“IEEPA”) does not authorize the president to impose tariffs. The ruling invalidated a sweeping set of “emergency” duties that had shaped sourcing, pricing, and margins across apparel, footwear, personal luxury goods, automotive manufacturing, and other consumer categories since early 2025.
That same day, President Trump moved to end collection of the IEEPA tariffs and invoked a different statute – Section 122 of the Trade Act of 1974 – to impose a temporary, across-the-board import surcharge. The administration initially set the surcharge at 10 percent before announcing it would rise to 15 percent, the maximum level permitted under Section 122. Even with the rate beginning at 10 percent, the back-and-forth itself has become part of the complexity for retailers trying to price, plan, and ship in real time.
At the same time, the Trump administration confirmed that duty-free de minimis treatment for low-value imports remains suspended, a decision with outsized consequences for cross-border e-commerce and digital-native fashion.
From Emergency Tariffs to a Global Surcharge
Under the now-invalid IEEPA actions, tariffs reached up to 35 percent on products of Canada, up to 25 percent on products of Mexico, and up to 20 percent on products of China, with additional “reciprocal tariff” measures described as running higher for many trading partners. For a mid-market apparel brand that had been modeling a 25 percent IEEPA rate into landed costs on goods sourced from Mexico, the move to a global surcharge capped at 15 percent represents a meaningful reduction. For companies whose exposure included multiple tariff authorities, the picture remains more complicated – but the IEEPA layer is gone.
Section 122 is also time-limited, meaning that it can run for 150 days without congressional action, after which continuation depends on Congress. Against that background, retailers planning late-year receipts are dealing with a tariff framework that, by design, has an expiration date – a challenging setup for an industry whose purchasing, production, and shipping cycles often run months ahead.
Just as importantly, the new Section 122 surcharge does not displace other tariff programs. The executive action ending the IEEPA duties makes clear that Section 232 and Section 301 duties remain unaffected, meaning the tariff stack still exists for many categories and many supply chains.
The Refund Wildcard
The more consequential issue for some companies may be backward-looking. Businesses have already paid enormous sums under the IEEPA tariffs, with collections estimated at roughly $134 billion. In response, hundreds of importers, trade groups, and state plaintiffs have filed lawsuits challenging the duties, many of which were stayed pending the Supreme Court’s decision. Whether refunds will now be available (and whether they will be issued broadly or only to litigants who preserved their claims) remains a live question that is expected to be resolved in further proceedings before the Court of International Trade and in related litigation.
For retail businesses, that uncertainty matters because refunds, if awarded, could materially affect liquidity, quarter-to-quarter forecasting, and commercial relationships. Many supplier agreements include tariff-allocation provisions addressing whether duties were passed through, whether surcharges were itemized, and what happens if a duty is later reduced or invalidated. If importers recover funds, downstream buyers may seek credits or renegotiations, and disputes over who ultimately bore the tariff burden are a realistic risk.
De Minimis Remains Closed
For digitally-native retail, the continued suspension of the de minimis exemption may prove as disruptive as the headline tariff rate. For years, the de minimis regime allowed many shipments valued at $800 or less to enter the U.S. duty-free, reducing friction for cross-border DTC and marketplace commerce. With duty-free treatment still suspended, small parcels that previously cleared with minimal customs burden now face duties and increased compliance complexity.
The practical effect is a shift in fulfillment economics for sellers shipping direct from overseas factories and for brands that leaned on low-value, high-frequency shipments. Some companies may accelerate investments in U.S. warehousing or nearshoring strategies. Others may revisit minimum order thresholds, shipping terms, and pricing models to offset added cost and friction.
Pricing, Planning & the Return of Uncertainty
Many brands raised prices in 2025 and pointed to elevated import costs as a contributor. With the IEEPA duties invalidated and the refund question unresolved, retailers face a delicate moment: some may prioritize margin repair, while others – especially in value and mid-market segments – may use selective price moves to compete for demand. The added complication is timing. Retailers that set pricing months in advance are now being asked to adjust to an evolving duty environment midstream, with uncertain refunds and shifting implementation details.
What is clear is that the Supreme Court’s decision removes one executive pathway to tariffs, but it does not eliminate tariffs as a policy tool. Retailers are now operating inside a new, time-limited surcharge regime – one that has already demonstrated how quickly rates, timelines, and implementation mechanics can shift – while legacy tariff programs remain in force and a major refund question hangs over balance sheets and contracts.
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