:max_bytes(150000):strip_icc()/GettyImages-2247460638-c5728348e44c4b09b0ba77c1a8dbc14c.jpg "Costco Is Suing the Trump Administration—Here’s Why")
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Key Takeaways
- Costco Wholesale is suing the Trump administration over tariffs imposed earlier this year.
- As the Supreme Court weighs whether the tariffs were legal, Costco argues they are not and says it should be refunded what it has paid.
Warehouse retail giant Costco Wholesale (COST) has joined the list of companies looking for a refund on tariffs.
The company filed a lawsuit against U.S. Customs and Border Protection and the Trump administration on Friday. In the Court of International Trade, Costco said that it would seek a refund of the tariffs it has paid on imports in the last several months if the Supreme Court finds Trump’s tariffs unconstitutional.
Costco did not specify in the filing how much it has paid in tariffs, but executives have said in earnings calls that the company was working with its suppliers to minimize the impact and that it would work to keep prices as low as it could.
In its complaint, Costco is requesting that the trade court find the tariffs are invalid, prevent CBP from collecting further tariff payments, and guarantee a refund of the tariffs the company has paid and those it may pay before the case is decided.
Why This Matters to Investors and Shoppers
Several retailers were clear after Trump’s tariffs were revealed that they would likely have to raise prices to compensate for the additional costs. Costco has said it would work to keep prices low by shifting where it gets products and what products it chooses to sell to maintain its margins.
The Supreme Court heard arguments last month on Trump’s tariffs after lower courts found them to be unconstitutional, and several justices appeared to be skeptical about Trump’s powers to impose the sweeping changes to U.S. trade policy.
There is no timeline for when the Supreme Court will decide its case, but it could happen before the end of the year. It’s also unclear if or how companies like Costco could potentially see a refund of any collected tariffs if they are struck down.
Costco shares are little changed in early trading Tuesday, and are flat since the start of the year.
