Amazon to Refund Some Tariff Costs, Plans to Use $600M in Recouped Duties to Cut Prices
- Aug 7
- 2 min read
Amazon received $600 million in refunds during the second quarter for tariffs that were later struck down, and plans to return a portion of those funds to customers, the company said on its Thursday earnings call. CFO Brian Olsavsky said the $600 million represents “the significant majority” of the refunds Amazon expects to collect from duties it paid under International Emergency Economic Powers Act (IEEPA) levies, which the Supreme Court invalidated in February.
Olsavsky said Amazon has “identified a limited set of circumstances” where it can trace specific tariff costs that were passed on to customers, and will contact those affected shoppers to automatically issue refunds. Beyond those targeted refunds, Amazon plans to funnel the recouped money into broader price cuts for shoppers, following a strategy similar to Walmart, BJ's Wholesale Club, and E.l.f. Beauty.
Amazon's refund total is notably smaller than those reported by companies like Nike and Ford. Olsavsky attributed the gap to Amazon's efforts to frontload inventory before the tariffs took effect, and to the fact that Amazon is typically not the importer of record for goods sold on its platform. “We are not the importer of record for the large majority of items sold in our store, given suppliers typically handle imports and pay relevant tariffs,” he said, adding that in cases where Amazon did see cost increases, it largely absorbed them rather than passing them on to customers.
Costco has also signaled it may issue refunds to members, though the timing and process remain unclear, complicated in part by a class-action lawsuit over how the retailer handles reimbursements. Costco CEO Ron Vachris said in May that how much the company returns, and when, depends on how much refund money it receives, when it arrives, and how the litigation develops.
Why it matters: As major retailers recoup hundreds of millions to billions of dollars from invalidated tariffs, how they choose to redistribute those funds — via direct refunds, price cuts, or otherwise — will shape both consumer costs and scrutiny from regulators and litigants over how the money is handled.