In July the United States collected negative $8.55 billion in import duties.
That is the Treasury's own line. Customs took in duty as usual, paid out $33.38 billion in refunds, and closed the month below zero — the third month running that the tariff line has gone backwards. June was bigger: $49.2 billion out the door. Through July 31, roughly $100 billion of about $166 billion collected under the emergency tariff program had been sent back, after the Supreme Court ruled in February that the statute never authorized the tariffs in the first place.
The money did not evaporate. It reappeared last week, in earnings. Walmart booked $2.9 billion, the largest refund any company has reported, and its operating income rose nearly 30 percent, which the company attributed partly to the money coming back. Home Depot took $730 million, TJX $331 million, Lowe's $80 million. Target's came to $994 million before tax, and the per-share line shows what that does: $1.65 of the company's $4.11 in quarterly earnings was a refund.
What's interesting is where it sits. Target recorded the refund as a reduction of cost of sales, which puts it in gross margin, the line meant to measure how well a retailer buys goods and sells them. And it goes to one party. A refund under the struck-down statute can be claimed by the importer of record — the name on the customs entry — and by no one downstream of it. The Tax Foundation estimates the levies cost the average household about $1,000 last year. There is no line on a customs entry for that.
Walmart says substantially all of its $2.9 billion is going back into price, and it ran 11,000 rollbacks in the quarter against 7,200 in the one before. It did not save the quarter. US comparable sales grew 2.6 percent, the slowest in six years, and the shares fell more than 8 percent that day.
The federal ledger gets no such offset. The deficit for the first ten months of fiscal 2026 reached $1.799 trillion, more than all of fiscal 2025 with two months still to run, and total debt crossed $40 trillion on August 18. Scott Bessent has called the refunds temporary and said he expects 2026 tariff income to land roughly where 2025's did, once the trade representative puts duties back on under a different statute.
The negative number is the one that ends: new duties are already in force, the refund queue empties when the last claim clears, and the quarter it flattered does not repeat. What stays is the interest, which has already run to $931 billion this fiscal year, with two months left to count.
The shopper who paid the higher price has no filing to make.
