Panic refunds Playdate tariff surcharges after Supreme Court overturns US tariffs

Nicole Carpenter and Diego Argüello, reporting for Game Developer: “There was a specific window of time this year where we charged tariffs to customers,” Panic co-founder Cabel Sasser explained in an e-mail to Game Developer confirming the news. “We tried absorbing the cost for a while, but that was financially difficult for a small company like ours. We made the tariff a very obvious and clearly labeled line item on checkout for any customer affected.” Panic also set up a website to explain the 19% tariff surcharge. [...] The refund amount a customer will get back depends on how much they purchased. “It’s just not our money to keep, and it felt really good to give it back,” Sasser said. “That’s an easy way to know you made the right decision.” He continued: “Still, it took a lot of work for us to file all the paperwork to get the refund from the government, and it took work to build a little system to process the refund, and sometimes it felt like, wait, why are we seemingly doing more work than even gigantic companies are on this issue? That felt weird. But I guess it makes sense in a way, because our small size means we’re far more directly affected by something like a tariff.” Sasser said he hopes Panic never has to talk about tariffs again. Cool story from a cool company, and amen to the day we never hear about tariffs again.  ★ 

Panic is refunding Playdate customers the 19% tariff charges it passed along while the Trump administration's import duties were in effect, after the Supreme Court ruled the tariffs illegal and the company began receiving refunds from the government. Panic says the money "just [wasn't] ours to keep." Ars Technica reports: In an update posted on the Playdate help site this week, Panic noted that it has finally "begun to receive refunds of the tariffs we paid in the last year" and had consequently "refunded all tariffs charged to customers." In the initial version of that tariff note, Panic explained that it couldn't afford to simply "absorb" the 19 percent tariffs it was being charged to import Playdate hardware made overseas because "our margins on Playdate are low." As such, while the tax was in effect, it was passed along to customers as an explicit subtotal line item at the bottom of all Playdate orders. That's in contrast to companies like Nintendo, which vaguely cited "market conditions" and tariff "uncertainty" in raising the asking price of legacy hardware and some Switch 2 accessories last year. Speaking to Game Developer, Panic co-founder Cabel Sasser said filing paperwork to claw back these taxes and processing tariff refunds for customers took a fair bit of backend work. Still, he said returning that money to Playdate purchasers in the end was a no-brainer. "It's just not our money to keep, and it felt really good to give it back," Sasser said. "That's an easy way to know you made the right decision." "It just felt like the right thing to do," Panic wrote in a refund email message shared on Reddit. Read more of this story at Slashdot.

As with so many other companies, including video game console makers, Panic increased the price of its Playdate handheld when US President Donald Trump implemented sweeping tariffs. When those tariffs were deemed unlawful and refunds become available to companies, most kept the money for themselves--but Panic has now confirmed it will be passing those refunds on to customers. Word of the refunds was emailed out to impacted customers recently. In the email, Panic explained how it had charged extra to compensate for its increased costs due to the tariffs, and that it had now received refunds from the government. With that money secured, it's automatically refunding the tariff amount--$12.36--to anyone who paid that surcharge, and the money should automatically end up in their accounts within the next few days. A Playdate system This move is in marked contrast to companies like Sony, Nintendo, and Microsoft, among others. Although many companies have sidestepped addressing the possibility of tariff refunds directly, there have been instances of them touting the impact of those refunds on their financials: both Sony and Nintendo highlighted the positive impact on their revenue from suddenly having a bunch of free money show up in their bank accounts.  The lack of refunds has led to class-action lawsuits that remain undecided. Nintendo, for its part, claimed in a court filing that it only imposed "modest and selective price adjustments," highlighting that it avoided increasing the Switch 2 price last year. “Nintendo or one of its retailers set a price for each product, and consumers decided whether that price was worth paying,” Nintendo said. “Those who bought Nintendo’s products received exactly what they bargained and paid for: a console, game and/or accessory at a price to which both parties agreed.” "If a consumer did not want to pay the advertised price, they were free to abstain from purchasing the product or seek out competing products," it added. On its website, Panic had provided a detailed rundown on what it was doing and why, explaining that due to the low margins it makes on the hardware, it couldn't afford to absorb the cost of tariffs. "Just so you know: We hate this. We know money is tight for everyone. We thank you for your patience and your kind understanding. Our deepest dream is that we can delete this line item, and this page, entirely, someday soon," it wrote back in February, shortly after the Supreme Court ruled against the tariffs. Whether or not that page does go away, Panic is now refunding these charges, despite the work it took to secure the refunds. "It's just not our money to keep, and it felt really good to give it back," Panic's Cabel Sasser told Game Developer. "That's an easy way to know you made the right decision." "Still, it took a lot of work for us to file all the paperwork to get the refund from the government, and it took work to build a little system to process the refund, and sometimes it felt like, wait, why are we seemingly doing more work than even gigantic companies are on this issue? That felt weird," he added. "But I guess it makes sense in a way, because our small size means we’re far more directly affected by something like a tariff." Panic's Neven Mrgan added on Bluesky, "[R]efunding tariffs took a bit of work on our end, ande definitely lost sales over the stupid thing after it was announced, but we still all agreed refunding them to customers was the right call." While this move by Panic is unlikely to put any real pressure on bigger companies to follow suit, it does demonstrate that such a move is possible. If nothing else, it helps to spotlight a delightful little gaming system that you might otherwise be unaware of.