A new legislative proposal aims to protect small businesses and consumers from the punishing impacts of President Donald Trump’s latest tariff scheme.
Introduced by Senator Ed Markey (D-Mass.) and co-sponsored by Senate Minority Leader Chuck Schumer (D-N.Y.) and Senators Mazie Hirono (D-Hi.), John Hickenlooper (D-Co.), Kirsten Gillibrand (D-N.Y), Amy Klobuchar (D-Minn.) and Chris Van Hollen (D-Md.), the Small Business Liberation 2.0 Act would exempt finished products and components imported by small businesses from President Donald Trump’s recently introduced 10 percent tariffs “to prevent price gouging with respect to goods subject to such duties.”
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The duties were imposed on Feb. 20 following the Supreme Court’s ruling invalidating the president’s International Emergency Economic Powers Act (IEEPA) duties using Section 122 of the Trade Act of 1974, which deals with balance-of-payments issues.
The bill stipulates that duties shall not apply to covered products that are imported by or for the use of small businesses, and any tariffs already collected under the administration’s tariff order should be refunded within a period of 90 days. It also holds businesses throughout the supply chain to account for their role in inflating prices, specifying that no one may sell or offer for sale a covered product at an unreasonably high price during the five-year period following the date that duties were increased.
The Small Business Liberation 2.0 Act is a follow up to an earlier version of the bill introduced in 2025, which was subsequently struck down by Republicans.
Markey and other liberal leadership have wasted no time in launching attacks against Trump’s latest tariff efforts now that his trade strategy appears hobbled and vulnerable.
Days after the IEEPA tariffs were invalidated, Markey, who serves as Ranking Member on the Small Business Committee, joined Senate Finance Committee Ranking Member Ron Wyden (D-Ore.) and Foreign Relations Committee Ranking Member Jeanne Shaheen (D-N.H.) and 20 other Democrats in deploying legislation that demands that small businesses be made whole for the tariffs they’ve paid.
The Tariff Refund Act of 2026 would require full refunds from Customs and Border Protection, with interest, of the tariff revenue collected under Trump’s IEEPA tariff order within a period of 180 days. The Senators wrote that the refund process can be cumbersome and burdensome for small businesses, so a legislative fix is in order to prioritize their needs and limit costly administrative actions.
“Our bill would require the tariffs to be refunded and level the playing field—putting small importers and small businesses first in the refund process and eliminating needless administrative barriers,” Markey said at the time. “It’s Main Street and working families that paid Trump’s tariff taxes, and we must ensure they get their money back—not big corporations.”
Federal lawmakers and state officials alike appear emboldened by the Supreme Court to hit back at the Trump administration’s efforts to preserve tariffs on imports. A coalition of 22 state attorneys general and two governors sued to stop the implementation of the Section 122 tariffs on Friday. Meanwhile, New York Governor Kathy Hochul met with small businesses on Monday and announced that she would sue the administration for $13.5 billion in tariff refunds owed to New Yorkers.
On Tuesday, Massachusetts Governor Maura Healey made a similar move, writing to Treasury Secretary Scott Bessent asking for payback from the federal government for her constituents.
“On behalf of the people of Massachusetts, I demand a refund of $1,745 to every Massachusetts household for the financial harm caused by President Trump’s unconstitutional taxes,” she wrote.
“With approximately 2.8 million households in Massachusetts, my office estimates that $4,886,000,000 is owed to consumers in our state who shouldered the burden of increased costs,” she added. “I call on the Trump Administration to immediately formulate a plan to refund tariff proceeds and put money back in the pockets of the hardworking people of Massachusetts.”
