Donald Trump
The US Supreme Court on Friday ruled Donald Trump’s sweeping global tariffs illegal — a stunning rebuke of the president’s signature economic policy that upended international trade.
The conservative-majority high court ruled six-three in the judgment, saying that a 1977 law known as the International Emergency Economic Powers Act (IEEPA) Trump has relied on “does not authorize the President to impose tariffs.”
The ruling does not impact sector-specific duties Trump separately imposed on imports of steel, aluminum and various other goods. Several government probes which could lead to more sectoral tariffs remain in the works.
Still, this marks Trump’s biggest defeat at the Supreme Court since returning to the White House last year.
While Trump has long relied on tariffs as a lever for diplomatic pressure and negotiations, he made unprecedented use of emergency economic powers in his second term to slap new duties on virtually all US trading partners.
These included “reciprocal” tariffs over trade practices that Washington deemed unfair, alongside separate sets of duties targeting major partners Mexico, Canada and China over illicit drug flows and immigration.
The court noted Friday that “had Congress intended to convey the distinct and extraordinary power to impose tariffs” with IEEPA, “it would have done so expressly, as it consistently has in other tariff statutes.”
The Supreme Court’s three liberal justices joined three conservatives in Friday’s ruling, which upheld lower court decisions that tariffs Trump imposed under IEEPA were illegal.
Conservative Justices Brett Kavanaugh, Clarence Thomas and Samuel Alito dissented.
Chief Justice John Roberts, in delivering his opinion, said “IEEPA contains no reference to tariffs or duties.”
A lower trade court ruled in May that Trump overstepped his authority with across-the-board levies and blocked most of them, but that outcome was put on hold as the government appealed.
With the White House already bracing for a negative outcome, KPMG chief economist Diane Swonk warned that “tariffs ruled illegal can be rapidly reinstated via other levers.”
“Financial markets rallied on the news, but that is premature,” she added.
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