Earlier today, the Supreme Court ruled against the Trump administration and concluded the president did not have the authority to implement his emergency tariffs, reported Ars Technica.
In a 6-3 decision, the Supreme Court justices ruled that the International Emergency Economic Powers Act (IEEPA) does not give Trump the power to enact tariffs. They also ruled that, generally, only Congress can impose tariffs on other nations.
Although the decision states there are exceptions, they are nonetheless bound by “explicit terms and subject to strict limits.”
“Against that backdrop of clear and limited delegations, the Government reads IEEPA to give the President power to unilaterally impose unbounded tariffs and change them at will,” wrote Chief Justice John Roberts.
“That view would represent a transformative expansion of the President’s authority over tariff policy. It is also telling that in IEEPA’s half century of existence, no President has invoked the statute to impose any tariffs, let alone tariffs of this magnitude and scope. That ‘lack of historical precedent,’ coupled with ‘the breadth of authority’ that the President now claims, suggests that the tariffs extend beyond the President’s ‘legitimate reach.’”
The ramifications of this decision remain to be seen.
For Trump, he could try to use other justifications for the tariffs. The decision left some wiggle room for the Trump administration, since it solely used the IEEPA to justify the tariffs.
For businesses, this could mean refunds are headed their way. According to a new estimate reported by Reuters, $175 billion could be “at risk of having to be refunded.”
Regardless, this would put a huge dent in Trump’s plan to collect money through the tariffs. The U.S. president claimed IEEPA tariffs would bring in $900 billion in 2027.
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