President Donald Trump’s ambitious tariff regime suffered a crushing defeat as the Supreme Court ruled Friday that he cannot use emergency legislation to levy massive import taxes on worldwide partners. The 6-3 verdict nullifies duties targeting countries from India to Europe, deeming them beyond the scope of the 1977 International Emergency Economic Powers Act.
In his opinion, Chief Justice John Roberts dissected the law’s text, history, and constitutional context, concluding it lacks the ‘clear congressional authorization’ needed for such expansive measures. Trump’s team had defended tariffs on everything from Indian goods (18% rate) to Chinese and Mexican imports as responses to trade imbalances, but the court disagreed.
Rarely does a right-leaning Supreme Court rein in a Republican president, making this a pivotal moment in executive authority debates. The ruling preserves Congress’s constitutional monopoly on tariffs while sparing narrow, industry-focused levies on steel, aluminum, and copper.
Businesses are poised to reclaim billions in overpaid duties, with challengers including Costco, parts of Toyota Group, Revlon, and many more. This unprecedented tariff use of the IEEPA—uncharted in its 50-year history—now lies in ruins.
The administration retains avenues through other statutes or legislative action, but the decision signals caution against stretching emergency laws into trade policy tools. Enacted for extraordinary threats, the IEEPA has traditionally supported sanctions, not wholesale duties.
This outcome recalibrates U.S. trade dynamics, prioritizing statutory precision over bold executive gambits and setting precedents for future economic nationalism.