Figure 1

US owes almost $700 million more in interest every month it delays IEEPA refunds

Cumulative IEEPA tariff collections and interest accrued, billions of USD

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Sources: Penn Wharton Budget Model; authors' calculations applying interest formula from CBP and interest rate from IRS.
Note: Interest is calculated daily using compound interest formula of:
(((1 + (RATE/NBR OF DAYS IN YR)) ^ NO OF DAYS) - 1) MULTIPLIED BY IEEPA TARIFFS COLLECTED.
To keep estimates conservative, authors apply the 4.5% rate for large corporate overpayments, even though the first $10,000 of each overpayment earns 6%. We also assume all tariff collections occur on the last of each month, so no interest accrues within the month of collection.