The Supreme Court of the United States dealt a significant setback to President Donald Trump’s economic agenda on Friday, ruling that most of the global tariffs imposed during his second term were unlawful.
 |
| Getty Images |
In a 6–3 decision authored by John Roberts, the court concluded that the International Emergency Economic Powers Act (IEEPA) does not grant the president authority to unilaterally impose tariffs. The ruling invalidates roughly 70% of Trump’s worldwide tariffs, which had generated more than $142 billion in revenue through December, according to the Yale Budget Lab.
Limits on Presidential Power
Writing for the majority, Roberts said the judiciary’s constitutional role in enforcing limits on executive authority.
“We claim no special competence in matters of economics or foreign affairs,” Roberts wrote. “We claim only the limited role assigned to us by Article III of the Constitution. Fulfilling that role, we hold that IEEPA does not authorize the President to impose tariffs.”
The administration had argued that language in IEEEPA allowing the president to regulate “importation” during national emergencies implicitly included the power to impose tariffs. The court rejected that interpretation, calling it an overly broad reading of the statute.
Roberts noted that the administration’s argument relied on isolating two words within a longer provision of the law, an approach the majority found unconvincing. Congress, the court reaffirmed, retains the exclusive authority to levy taxes and tariffs.
“The Framers did not vest any part of the taxing power in the Executive Branch,” the ruling stated.
Dissents Warn of Economic Consequences
Justices Clarence Thomas, Brett Kavanaugh, and Samuel Alito dissented, arguing that the president should be able to impose tariffs in response to national emergencies.
Kavanaugh wrote that while the tariffs might be controversial as policy, they were legally justified under existing statutes. He also warned that undoing them could create serious financial and logistical complications.
“Refunds of billions of dollars would have significant consequences for the U.S. Treasury,” Kavanaugh wrote, noting that the court offered no guidance on whether importers would be entitled to recover tariff payments already made.
What Remains in Effect
The ruling does not affect all of Trump’s tariffs. Those imposed under Section 232 of the Trade Expansion Act of 1962, including duties on steel and aluminum, remain intact. Trump has previously suggested he might attempt to reclassify tariffs as “licenses” under alternative legal frameworks, though legal experts say such a move would almost certainly face court challenges.
The White House said it is prepared to explore other statutory avenues to reimpose tariffs consistent with the court’s decision.
Business Fallout and Legal Uncertainty
Numerous companies—from major retailers such as Costco to small import-dependent businesses—had already filed lawsuits seeking refunds if the tariffs were struck down. While the court’s decision invalidates the legal basis for many of the duties, it does not address how refunds would be handled, leaving uncertainty for both businesses and the federal government.
Trump, who had publicly urged the court to uphold the tariffs, defended them as essential to economic stability, saying earlier this week that the country would be “in serious trouble” without them.
With the ruling now in place, the decision marks a pivotal moment in the balance of trade authority between Congress and the presidency, and it is likely to shape U.S. trade policy for years to come.