Treasury projects steady tariff income for 2026 despite court limits on IEEPA

Treasury Secretary Scott Bessent said Treasury expects collections tied to the administration's emergency import duties to be broadly unchanged in 2026 even after the Supreme Court curtailed the use of the International Emergency Economic Powers Act. Treasury officials signaled the department will preserve the net cash flow from tariffs in the near term by switching the legal basis for duties and reissuing regulatory notices and duty schedules under alternative statutes.

Officials described a two-part strategy: first, maintain similar headline duty levels so fiscal forecasts are not materially disrupted; second, defend the new administrative approach in court and before Congress. The move reflects the practical tension between immediate budget needs — recent monthly customs receipts approached about $30 billion and fiscal-year-to-date collections have risen sharply — and the longer legal vulnerability created by the court's decision.

Treasury cautioned that sustaining receipts under different authorities will invite litigation and heightened congressional oversight. Industry and legal teams should expect a wave of targeted lawsuits challenging the new statutory rationales and administrative procedures, while Customs and Border Protection may face operational complications implementing replacement orders and handling protests or refund petitions.

For importers and customs brokers, the operational takeaway is straightforward: duty bills and filings may look similar even as the legal labels behind them change. Firms should update compliance workflows, preserve payment records and prepare for administrative claims—steps that will matter if courts later order refunds or if Treasury designs a claims process that prioritizes documented payments.

The fiscal picture remains uneven. While the near‑term numerical outlook for receipts looks stable, the surge of contested revenues has complicated budget planning: large, concentrated collections raise the political and logistical cost of mass refunds, and independent estimates have put tariff exposure in the high tens to low hundreds of billions of dollars. Treasury warned during the episode that collections could grow sharply if the program continued, amplifying the stakes of any judicial or legislative response.

Market participants already reacted to the changing legal landscape: equities of import‑exposed retailers and marketplaces re‑priced policy risk after the court moved to limit one emergency authority, and analysts noted that some of the consumer price pressure from tariffs has been absorbed by firms or muted by carve‑outs and negotiated exemptions. Still, trade data show frictions — a recent jump in the goods deficit and concentrated state‑level exposure underscore that duties reshuffle costs rather than uniformly reduce imbalances.

Diplomatically, trading partners may see the administration's pivot to other statutes as an effort to blunt the effect of the court's ruling, raising the prospect of international complaints or negotiated adjustments. Policymakers face a choice between cementing a lucrative revenue stream through administrative measures and easing pressure on consumers and supply chains, a tension that will animate congressional oversight and potential legislative fixes.

Treasury's assurance reduces immediate headline fiscal uncertainty but increases legal and implementation risk: courts could later unwind successor actions or mandate refunds, producing retroactive liabilities for some importers and forcing Treasury to redesign cash‑management and claims procedures. For businesses and markets the relevant planning window is the next 12–24 months, as litigation, administrative claims programs and possible congressional action will determine whether the administration can sustain tariff receipts without material disruption.