• Tariff fluctuations over the last year have added a new level of complexity for importers.
• Companies are using generative AI to complete the time-consuming tariff refund process.
• Generative AI can also save weeks of time on complex scenario planning for sourcing materials.

US businesses have been on a tariff roller coaster over the last year. Sweeping tariffs were implemented at varying levels across different countries. Though some were eventually overturned by the Supreme Court, there is now an added layer of bureaucracy as companies seek potential refunds. Some are turning to AI for help.

Companies like EQI and customs advisory firms like KPMG are using generative AI "to process all that chaos," said Brendan Connallon, the VP of finance at EQI, a company that supplies metal components and provides supply chain advising services to manufacturers. The technology can rapidly scrape and synthesize vast quantities of data, track tariff changes, model potential supply chain scenarios, and accurately classify goods by their government-assigned tariff codes — a highly nuanced system with more than 17,000 codes.

Emil Stefanutti, the CEO of Gaia Dynamics, a software company that provides AI tools to help companies automate trade compliance, said AI is proving particularly useful in this rapidly changing environment, as it can reduce compliance errors and save businesses time. With the Supreme Court ruling specifically, Stefanutti said importers can use AI to analyze data on where and when they paid tariffs, quantify potential overpayments, and flag areas that need correction.

AI "can continuously track and adapt to new rules in a way humans simply can't at scale," Stefanutti said.

AI can shave weeks off pinpointing tariff refunds

The consulting firm KPMG has been advising its clients on trade compliance for decades, but last year in particular, "the tariffs were changing fast and furious," said Andrew Siciliano, the leader of the Global and US Trade and Customs practices at KPMG.

Company leaders needed real-time data quickly to make decisions, so KPMG launched an AI-powered tariff modeler.

The firm's clients include many large businesses that import goods ranging from auto parts to retail goods and pharmaceuticals, and that use several ports of entry and customs brokers. KPMG takes its clients' decentralized customs entries and product information from suppliers and freight forwarders — the intermediaries between importers and their transportation providers — and plugs the data into the tariff modeler, Siciliano said.

This approach has helped KPMG's clients navigate the process of applying for refunds for tariff overpayments resulting from the policy change that took effect after the Supreme Court overturned some tariffs. Many trade rules have nuanced exceptions, leading some businesses to pay multiple tariffs when they should have paid only one. Siciliano said his firm uses AI to interact with a client's data and better understand which products came from which factories, narrowing down which qualify for refunds.

Though the refund system is in the works, there could still be confusion and uncertainty, said Connallon. He told Business Insider that he anticipates the process will be "an administrative nightmare."

Before AI, manually sifting through thousands of custom entry data points to spot overpayments could take weeks or months — or not happen at all because of the complexity, Siciliano said. Now, an importer can prompt AI, which delivers the information right away.

AI can speed up complex scenario modeling

AI also saves weeks of time in scenario planning. An importer might wonder how costs could change if it moved sourcing from China to Vietnam, for example. Instead of taking weeks to update multiple spreadsheets, AI models scenarios with the click of a few buttons, Siciliano said.

Connallon said EQI uses AI in a similar way to model potential sourcing scenarios. The company uses the AI platform Altana, which focuses on supply chain management and trade compliance.

In a potential sourcing move from country A to B, EQI uses AI to model total costs, accounting for tariffs, manufacturing costs, and ocean freight rates. For manufacturing, which sources thousands of different products from myriad locations, "the complexity becomes extremely dense very fast," Connallon said. "So, AI helps us simplify it." EQI sends the simplified data to its trade attorneys, who can interpret it within hours, said Connallon.

"We've turned something that would take weeks into a same-day thing," he said.

He added that "AI is not good at critical thinking," and that humans are essential for sourcing decisions. For example, the AI model might say that sourcing all materials from one country results in the greatest cost savings, but business leaders have to consider the bigger picture, said Connallon. Supply chain executives have learned, especially in recent years, that sourcing solely from one country carries risks, such as product shortages or delays if a geopolitical or economic issue halts trade flows.