Supreme Court Strikes Down Trump Tariffs, President Imposes New 10% Global Tariff

The Supreme Court on Friday struck down most of President Donald Trump’s sweeping tariffs, dealing a setback to a key element of his trade policy. Shortly after the ruling, President Trump responded by imposing a new 10% global tariff, calling the court’s decision “terrible” and criticizing the justices.

Supreme Court Ruling

In a 6-3 decision, the justices ruled that the tariffs exceeded the authority granted to the president by Congress under the 1977 International Emergency Economic Powers Act (IEEPA). SCOTUSblog reports the court found that IEEPA did not explicitly authorize the president to impose tariffs. The ruling opens the door to potentially billions of dollars in tariff refunds for importers, though the process for obtaining those refunds remains uncertain.

The case centered on import taxes Trump unveiled on goods from nearly every country, initially targeting Mexico, Canada, and China before expanding to dozens of trade partners. The Trump administration had argued that the power to “regulate” trade under IEEPA encompassed the authority to impose tariffs. Chief Justice John Roberts, writing for the majority, disagreed, stating that the words “regulate” and “importation” were insufficient to grant the president such broad power. PBS News provides further details on the court’s reasoning.

Trump’s Response: A New 10% Tariff

Following the Supreme Court’s decision, President Trump announced a new 10% global tariff to replace the ones struck down. BBC News reports Trump indicated he expected legal challenges to any refunds of previously collected tariffs, predicting years of court battles. He also stated he would explore other legal avenues to continue imposing tariffs, arguing they encourage investment and manufacturing in the U.S.

Dissenting Opinions and Concerns

Justice Brett Kavanaugh, in a dissenting opinion joined by Justices Clarence Thomas and Samuel Alito, expressed concern that the ruling could create uncertainty regarding various trade agreements. He also suggested the federal government “may be required to refund billions of dollars to importers” who have already paid the tariffs. Kavanaugh argued the major questions doctrine should not be applied to foreign-facing statutes, as authority over foreign affairs is generally considered a presidential prerogative.

Economic Implications

The Supreme Court’s decision and the subsequent imposition of a new tariff inject uncertainty into the global trade landscape. Trump’s initial tariffs were criticized for increasing prices, decreasing employment, and stymying investment. The new 10% tariff could have similar effects. Politico notes the ruling came after Democrats overperformed in recent elections, fueled in part by voter concerns about high prices.