INSIGHT

What Does the Supreme Court’s Tariff Decision Mean for Your Business? 

February 20, 2026

Services: Transfer Pricing, International Tax, Corporate Tax Industries: Construction, Wine & Agribusiness, Technology, Life Science, Consumer Business

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On February 20, 2026, the U.S. Supreme Court issued a significant trade ruling that affects businesses managing import costs, supply chain decisions, or cross-border sourcing. Here’s what you need to know. 

In a 6-3 decision authored by Chief Justice John Roberts, the Court found that a broad set of tariffs exceeded the President’s statutory authority under the statutes cited. However, this is not a sweeping rollback. Tariffs enacted under other legal frameworks remain in effect, and the administration has indicated plans to pursue duties through alternative authorities. 

The landscape is more complex than initial headlines suggest, and businesses will want to assess how the ruling applies to their specific circumstances before making operational or sourcing decisions. 

What the Ruling Actually Says — and What It Doesn’t 

Before you start renegotiating contracts or repricing your product line, it’s worth getting clear on the scope of the ruling. The Court’s decision targeted a specific category of tariffs: those imposed under the International Emergency Economic Powers Act, or IEEPA. This is the 1977 emergency statute the administration used to impose broad tariffs on imports from nearly every U.S. trading partner. The Court found that IEEPA does not authorize the president to impose tariffs, and that Congress never granted that power. 

Importantly, the ruling does not wipe the slate clean. These tariffs remain in effect: 

• Section 232 tariffs on steel and aluminum, imposed under the Trade Expansion Act of 1962 
• Section 301 tariffs on Chinese goods, carried over from Trump’s first term and imposed under the Trade Act of 1974 
• Any tariffs reimposed through other statutory authorities, which the Trump administration has already signaled it intends to pursue 

The ruling addresses a significant portion of the tariff landscape — including the “reciprocal” tariffs applied to goods from most U.S. trading partners, and the 25% tariffs on imports from Canada, China, and Mexico that were imposed under an emergency declaration related to fentanyl trafficking. All were enacted under IEEPA authority and fall within the scope of the Court’s decision. 

This distinction matters enormously. Some of your cost assumptions may have just shifted in a meaningful way. Others are still very much intact. Getting that analysis wrong — in either direction — could mean leaving real savings on the table or making strategic decisions based on a misread of the landscape. 

Could Your Business Be Owed a Refund? 

One aspect of the ruling that warrants close attention for businesses is the question of refunds — and it could be significant for your bottom line. 

Because the Court found IEEPA tariffs to be unauthorized, businesses that paid those tariffs may have a legal basis to seek refunds from the Treasury Department. Estimates of total IEEPA tariff collections range from $130 to $150 billion as of late 2025, and scores of companies — including major retailers and importers — have already filed lawsuits seeking to recover what they paid. 

The Court’s majority did not directly address the refund question, leaving it unresolved for now. But the door appears to be open, and businesses that moved significant import volume under IEEPA tariff exposure should be taking stock of their potential claims. 

A few immediate questions worth working through with your advisors: 

• What did you actually pay under IEEPA tariffs specifically? Not all tariffs are the same, and separating IEEPA-based costs from other duties is the necessary first step. 
• Did you pass those costs through to customers? The refund picture may be more complex if tariff costs were embedded in pricing — and that’s a conversation worth having proactively. 
• Have you already filed suit or joined a class action? If not, understanding your options and the relevant timelines matters now, before the process gets more complicated. 
• What are the accounting implications? For companies that recognized tariff costs in prior periods, there may be financial reporting considerations to work through as the refund landscape clarifies. 

The refund process is expected to be complex and drawn out — a characterization Justice Kavanaugh himself used in his dissent — but that’s precisely why getting organized early puts you in a stronger position than waiting for clarity that may be slow in coming. 

Implications for Manufacturing, Wholesale, and Consumer Goods 

This ruling lands hardest — and most immediately — for consumer business companies in manufacturing, wholesale distribution, apparel, textiles, natural and organic foods, and food technology. These are sectors where tariff costs weren’t just a line item; they were shaping real operational decisions. You may have renegotiated supplier agreements, shifted sourcing to alternative markets, or passed costs through to customers. 

Now comes the recalibration. 

Supply Chain and Sourcing Strategy 

If you restructured your supply chain around tariff mitigation, this ruling may change the calculus. Some of the cost differentials you were managing around may narrow or disappear — but only for the affected tariff categories. Before making any moves, you need a clear picture of which of your import costs were tied to the struck-down IEEPA tariffs versus those that remain. 

This is also a natural moment to revisit your transfer pricing strategy. If your global tax structure was built around assumptions that no longer hold, your intercompany pricing arrangements, documentation, and profit allocations may all be due for a review. 

Financial Modeling and Forecasting 

If your FP&A team built budgets and margin forecasts around elevated import costs, the reversal — even a partial one — changes your numbers. What does your gross margin look like now? How does it affect pricing strategy, working capital needs, or growth projections? CFOs and finance leaders who built models around worst-case tariff scenarios should be running updated scenarios now, not at the next quarterly review. 

What This Means for Wine, Agribusiness, and Food Production 

Agricultural businesses and wine producers have been caught in a particularly complex tariff environment — facing headwinds on both the import side (equipment, inputs, packaging materials) and the export side (retaliatory tariffs from trading partners). The ruling creates some potential relief, but the picture varies significantly depending on your product category, origin markets, and trade relationships. 

For wine producers and distributors with international exposure, the immediate question is whether your import duties or distribution economics change materially — and whether that creates an opening for any commercial renegotiations. Given that the fentanyl-related tariffs on Canadian and Mexican goods were IEEPA-based, businesses sourcing from those markets should be particularly attentive to how quickly those changes take effect. 

Considerations for Technology and Life Sciences 

Hardware-dependent technology companies and life sciences businesses sourcing equipment and materials internationally have felt sustained cost pressure from tariffs on components and specialized inputs. While some of that pressure may ease depending on your specific supply chain, the more pressing question for many technology and life science companies is how this affects your global tax structure. 

Transfer pricing arrangements that were calibrated around tariff-elevated cost bases may now need adjustment. If your intercompany transactions assumed certain cost levels that have shifted, your arm’s-length pricing analysis deserves a fresh look — both to stay compliant and to make sure you’re not overpaying. 

Understanding the Potential Impact on Construction 

The construction sector has been absorbing significant cost pressure from tariffs on imported steel, aluminum, lumber, and other building materials. For firms managing large-scale projects, those costs get embedded in project budgets, subcontractor bids, and long-term contracts — which means the impact of any reversal isn’t always immediate or obvious. 

Project-Level Cost Modeling 

If you’re in the middle of a project bid or have active contracts with materials cost provisions, now is the time to model what changed and what didn’t. Lumber and other materials covered under IEEPA tariffs may see cost relief. Steel and aluminum — which fall under Section 232 and are unaffected by this ruling — likely won’t. Getting that distinction right at the project level could materially affect both your competitiveness on new bids and your margin on existing work. 

What You Should Be Doing Right Now 

Across all of these sectors, the common thread is the same: businesses that assess their position early will be better positioned to respond thoughtfully — whether that means capturing margin improvement, pursuing a refund claim, renegotiating supplier terms from a stronger position, or simply making sure your financial models reflect reality. A few immediate priorities worth addressing: 

• Map your tariff exposure by category and legal authority — IEEPA versus Section 232 versus Section 301 — since the ruling affects only a subset of the tariffs you may have been paying 
• Quantify your potential refund exposure and assess whether filing a claim or joining existing litigation makes sense for your situation 
• Revisit your transfer pricing documentation if your intercompany structure was calibrated around tariff costs that have changed 
• Reforecast your margins with updated import cost assumptions, and pressure-test your pricing strategy accordingly 
• Review active transactions or pending deals where tariff assumptions were part of the valuation or deal structure 
• Consult with your tax advisors on any ASC 740 implications if you’re a public company with tariff-related disclosures 

The tariff story isn’t over — it’s just entered a new and more complicated chapter. The legal landscape will continue to evolve, and there will likely be further administrative action, congressional response, and litigation around both the reimposition of tariffs under alternative authorities and the resolution of refund claims. What matters right now is that you understand your specific exposure, model your options, and make decisions based on an accurate read of where things actually stand today. 

BPM’s international tax, corporate tax, transaction advisory, transfer pricing, and FP&A teams are ready to help you work through the implications for your business.