Supreme Court strikes down Trump-era tariffs in landmark trade ruling
The US Supreme Court has struck down a set of sweeping import tariffs imposed under former President Trump. In a 6-3 ruling, the court found that the International Emergency Economic Powers Act of 1977 did not grant the president authority to introduce such broad levies. The decision now sends the case back to a lower court for dismissal, effectively ending the controversial measures.
The move has drawn mixed reactions, with retailers welcoming the certainty it brings while other industries brace for ongoing cost pressures from separate tariffs still in place.
The tariffs in question were first introduced under President Trump in 2018, using the International Emergency Economic Powers Act (IEEPA) as justification. The Supreme Court's ruling now invalidates these levies, which had applied to a wide range of imports, including a 15% base tariff on goods from the EU. The decision follows an earlier invalidation of tariffs under the same act, reinforcing limits on presidential trade authority.
In response, Trump condemned the ruling and announced a new global tariff rate of 10%, later raised to 15%. This time, the administration relied on Section 122 of the Trade Act of 1974, which permits temporary tariffs without immediate congressional approval. The shift signals a continued push for trade restrictions, despite the legal setback.
Retailers, particularly those in apparel and footwear, have been among the hardest hit by tariffs targeting key sourcing countries like China and Vietnam. The National Retail Federation praised the Supreme Court's decision, calling it a step toward 'much-needed certainty' for supply chains. The group also urged the lower court to ensure a smooth process for refunding up to $175 billion in tariffs already paid by US importers. Over 1,800 companies, including major retailers like Costco, have filed lawsuits seeking reimbursements.
Yet not all sectors will see relief. Furniture remains subject to high duties, with further increases scheduled later this decade. Consumer goods companies still face elevated costs from Section 232 tariffs on steel and aluminium. Some agricultural products, such as coffee and spices, received partial exemptions late last year, but broader pressures—like high interest rates and weaker housing demand—continue to weigh on businesses.
The lower court will now handle the formal dismissal of the tariffs, though the financial impact of refunds and ongoing trade policies remains uncertain for many industries.
The Supreme Court's decision removes one layer of tariffs but leaves others intact. Businesses in sectors like furniture, steel, and autos will still face elevated import costs. Meanwhile, the potential refund of $175 billion in previously paid duties could provide some relief, though the process and timeline remain unclear.
The ruling also sets the stage for further legal and political battles over trade policy, as the administration explores alternative ways to impose tariffs.
