Supreme Court Curbs Presidential Tariff Authority
The U.S. Supreme Court has ruled that tariffs are a “taxing power” exclusively reserved for Congress, limiting the executive branch's authority to impose them unilaterally. In response, President Trump criticized the decision and announced a new 10% global levy. The ruling comes as Trump is actively campaigning in Georgia for the race to replace Marjorie Taylor Greene.
- The Supreme Court's 6-3 decision centered on the International Emergency Economic Powers Act (IEEPA) of 1977, which the majority opinion stated does not grant the president the authority to impose tariffs because the power to tax is reserved for Congress. - The ruling specifically invalidates the broad "reciprocal" tariffs and those related to fentanyl trafficking that President Trump had imposed under IEEPA, but does not affect tariffs levied under other laws, such as Section 232 "national security" tariffs on steel and aluminum. - Chief Justice John Roberts' majority opinion invoked the "major questions doctrine," arguing that if Congress intended to delegate a decision of such vast economic and political significance, it would have done so with explicit language. - The tariffs collected under IEEPA are estimated to be over $160 billion, and the Supreme Court's ruling did not specify whether or how this money should be refunded to importers, leaving the issue for lower courts. - In his dissent, Justice Brett Kavanaugh argued that regulating importation is a traditional tool of foreign policy and that the court's decision could create uncertainty regarding international trade deals worth trillions of dollars. - President Trump's proposed 10% global levy would be implemented under Section 122 of the Trade Act of 1974, an authority never before used, which allows for temporary tariffs of up to 15% for 150 days to address a balance-of-payments deficit. - Historically, Congress has delegated some tariff authority to the executive branch through specific legislation, such as the Trade Expansion Act of 1962 and the Trade Act of 1974, which contain procedural requirements and limitations not present in the IEEPA.
