Trump tariffs struck down

Tariffs are back in court again — and Trump just lost another round. On May 7, the U.S. Court of International Trade said his 10% blanket tariff on most imports was unlawful. That matters because this was not the original tariff program the Supreme Court knocked out in February. It was the backup plan. And now that backup plan is wobbling too. ### What did the court actually strike down? The court struck down the 10% across-the-board tariff Trump imposed in February on most goods coming into the U.S. The administration had relied on Section 122 of the Trade Act of 1974 — a narrower law than the emergency powers theory Trump used for his earlier “Liberation Day” tariffs. A divided three-judge panel said that law did not let the president do a standing global tariff of this kind. (politico.com) ### Why was there a “backup” tariff at all? Because the first version already died in court. In February 2026, the Supreme Court vacated Trump’s earlier sweeping tariffs, which had been imposed under emergency authority. After that loss, the White House pivoted fast and rolled out this 10% global tariff as a replacement. Basically, Trump tried a different legal door after the first one slammed shut. (politico.com) ### Why did judges say Section 122 didn’t work? Section 122 is real tariff authority, but it is limited. It was designed for balance-of-payments problems and short-term action, not a permanent-looking universal import tax. The court’s point was not “presidents can never use tariffs.” It was narrower — this statute does not stretch far enough to support a broad 10% tariff on nearly everything. That is why this ruling is such a direct hit on Trump’s legal theory, not just on one paperwork step. (cbsnews.com) ### Did the administration just give up? No — it appealed immediately. That means the tariffs do not simply disappear from practical life overnight. The legal fight now moves up the chain, and businesses still have to plan around uncertainty while the appeal plays out. That uncertainty is the real tax here. Importers do not know whether to price for duties, for refunds, or for another policy rewrite. (politico.com) ### What’s going on with refunds? This is the messy part. Customs and Border Protection opened an online refund system in April for businesses seeking repayment on tariffs already invalidated by the Supreme Court. Reports around that rollout pointed to roughly $166 billion in duties potentially tied up in claims, with payments expected to take 60 to 90 days after approval. So even before this week’s court loss, companies were already dealing with a strange two-track world — one portal for getting old tariff money back, while new tariffs kept appearing. (finance.yahoo.com) ### Why does this matter beyond the courtroom? Because tariffs are leverage only if everyone believes they will stick. Trump’s trade strategy has leaned heavily on unilateral tariff threats. But after a Supreme Court defeat and now a trade-court defeat, that strategy looks less durable. Trading partners can see that the White House keeps reaching for broad tariff tools that courts may not let it keep. (cnbc.com) ### So what should people watch next? Watch the appeal, and watch whether the administration tries yet another legal route. Also watch the practical side — refunds, customs guidance, and whether companies start rewriting contracts around the possibility that tariff policy can vanish mid-shipment. The bottom line is simple: this was supposed to be Trump’s fallback tariff regime. Now even the fallback is in trouble. (politico.com)