In brief
Target has confirmed a pre‑tax reimbursement of $994 million from U.S. tariff refunds, boosting its second‑quarter operating income to $2.6 billion, double the prior year. The payment follows a Supreme Court ruling that invalidated Donald Trump’s import tariffs, and the company is also cutting prices on over 10,000 items as it reduces reliance on Chinese suppliers. While the refund helps profitability, economists warn consumers may see higher prices if firms pass on remaining tariff costs. Meanwhile, President Trump has paused new tariffs on Canadian goods, emphasizing ongoing trade negotiations.
US retail giant receives $1bn boost from tariff refunds
Target reports pre‑tax reimbursement of $994 million, doubling Q2 operating income.
Target has confirmed it received a pre‑tax reimbursement of $994 million, or about $1 billion, in tariff refunds from the U.S. government. The payment pushed the retailer’s second‑quarter operating income to $2.6 billion, double the $1.3 billion reported a year earlier.
The refund follows a Supreme Court ruling that declared Donald Trump’s 2018‑2020 import tariffs unlawful. Other businesses—big and small—have also reclaimed money, with the government paying back roughly $100 billion in what the administration called “Liberation Day” refunds.
Chief financial officer Jim Lee said the company would continue to invest “in price.” He declined to specify how the refund would be used.
Target has also been working to reduce reliance on Chinese suppliers, slashing store‑label sourcing from 60 % in 2017 to 30 %. The company’s turnaround plan includes cutting prices on more than 10,000 items in the past year.
Meanwhile, President Trump has paused a new set of tariffs on Canadian goods for three days amid trade negotiations. The president remains threatening tariffs on nearly $20 billion of Canadian imports, citing unresolved issues over auto duties and liquor sales.
Economists warn that while tariff refunds help profitability, the costs of trade policy can ripple to consumers, who may see higher prices if firms pass on taxes.
By Michael Race, Business reporter, New York
Published 1 hour ago
