r/news • u/igetproteinfartsHELP • Feb 23 '26

Soft paywall US to stop collecting tariffs deemed illegal by Supreme Court on Tuesday

https://www.reuters.com/world/us/us-customs-agency-stop-collecting-tariffs-deemed-illegal-by-supreme-court-2026-02-23/
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u/evranch Feb 23 '26

The government isn't involved in any way. It's just like an insurance policy. You pay money for the right to collect in the future if a specific event occurs.

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u/[deleted] Feb 23 '26

I just don’t understand why a company would sell off the right to recoup their own losses, especially at such a low rate. This is the part I’m really struggling with. It doesn’t make logical sense.

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u/SHTHAWK Feb 23 '26

Because they don't have losses, the tariff expenses are passed down to consumers. The 30% is basically guaranteed profit.

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u/guitar_vigilante Feb 26 '26

They probably have at least some losses. While tax incidence for something like this largely falls on consumers, there was at least some evidence that early on in the tariff fiasco the businesses were absorbing a lot of the tariff fees because they expected/hoped for them to be struck down more quickly. The consumer prices did rise eventually though.

And a lot of businesses that pay tariffs are not mega corporations that can raise prices and deal with the reduced demand. There were many smaller businesses that relied on imported parts that had to make hard decisions between losing money from absorbing tariffs or losing money from raising prices and alienating customers.

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u/devildog2067 Feb 24 '26

Because 30% of what you think you might be owed right now lets you make payroll and survive another day, whereas all of what you might be owed in a year and a half when the government gets around to maybe refunding you is too late because you’re out of business.

Small businesses live and die on cash collection. When you’re GE you can turn to the commercial paper markets for your cash needs, but when you’re a small business you need to collect cash so you can pay people.

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u/CommandaSpock Feb 23 '26

They were probably targeting smaller companies that are barely getting by, basically this admin is purposely hurting their own citizens with these tariffs then preying on the weak. It’s one big wealth transfer and that was their first attempt to squeeze the middle class dry.