‘Liberation Day’ now a multi-billion-dollar liability
Today marks one year since US President Donald Trump sent shockwaves across global economies with the imposition of the US Government’s “Liberation Day” tariffs.While Australian exports were hit with the baseline 10%, other US trading partners were hit harder — Canada was hit with 35% and Brazil a whopping 50%.A sweeping 25% tariff on steel and aluminium products and a 50% tariff to copper and copper-containing products was also applied on all US imports.Prime Minister Anthony Albanese said the tariffs were totally unwarranted."President Trump referred to reciprocal tariffs. A reciprocal tariff would be zero, not 10%," he said."The administration's tariffs have no basis in logic and they go against the basis of our two nation's partnership.“This is not the act of a friend."In February, after several importers lodged lawsuits claiming that President Trump exceeded his authority and subjected US trade policy to his whims, the US Supreme Court declared the tariff regime illegal. The court found that President Trump did not hold the power to impose tariffs on imported goods under the International Emergency Economic Powers Act (IEEPA).In December, the US Customs and Border Protection reported the amount of tariffs collected at risk of having to be refunded was US$133.5b.In early March, the US Court of International Trade (CIT) ordered the US Government to commence the refund process for the illegally obtained taxes.The total owed to Australian exporters is yet to be determined, but figures could be eye wateringly high.In 2025 Australian exports to the US totalled about $36.3b — with metals and minerals accounting for about half of that total — according to figures from the United Nations COMTRADE database.The US Customs and Border Protection agency is progressing a streamlined process for refunding the illegal tariff collections but has advised the new system could take up to ?45 days to review and process refund applications.In a filing with the US Court of International Trade, lodged on March 31, US Customs and Border Protection official Brandon Lord says development of a new refund claims portal ?system is now 60-85% complete.In his declaration, Mr Lord confirmed that more than 26,000 importers who paid US$120b in IEEPA tariffs were already registered to receive electronic refunds, though he did not provide a roll out date.Mr Lord also confirmed that the system, in its first phase, will only be capable of processing 63% of entries for which IEEPA duties were paid or have been deposited.Rio Tinto (ASX: RIO) recently advised that it had paid almost $1.45b in taxes to the US Government in 2025 due to additional tariffs and — though the percentage of those payments that fell under the IEEPA has not been specified — may be amongst claimants.Since the US Supreme Court’s ruling, the tariff landscape has shifted— but not disappeared.Invoked under Section 122 of the US Trade Act, the US Government has now implemented a new, and legally sound, 10% tariff. However, under this legislation, the tariff can stay in place for a maximum of 150 days.There is no denying the weaponisation of trade is affecting global markets, however, as the world faces ongoing supply chain disruptions, the extent to which it is reshaping the dynamics of global trade is yet to be determined.
