News / Supreme Court strikes down Trump tariffs, triggering refund scramble

UPDATED TO INCLUDE NEW TARIFFS

There will be a rush for tariff refunds after the US Supreme Court struck down most of President Trump’s emergency tariff regime. In a 6–3 decision released today, the Court held that the International Emergency Economic Powers Act (IEEPA) does not authorise the president to impose broad import tariffs in a declared emergency.

However, Trump has insisted little will change. He wrote on his social media site: “Effective immediately, all National Security TARIFFS, Section 232 and existing Section 301 TARIFFS, remain in place, and in full force and effect. Today I will sign an Order to impose a 10% GLOBAL TARIFF, under Section 122, over and above our normal TARIFFS already being charged, and we are also initiating several Section 301 and other Investigations to protect our Country from unfair Trading practices.”

Chief Justice John Roberts noted in the ruling that only Congress has the constitutional authority to levy taxes and duties, including tariffs, and that IEEPA’s language does not clearly empower the president to impose such sweeping trade levies. The opinion underscored that while regulating foreign commerce is an executive concern, tariffs are taxes, and the constitution vests that power in the legislative branch.

The decision immediately invalidates the emergency tariffs that had been imposed on a wide range of imports, including so-called reciprocal duties on Canada, Mexico, China and other trading partners. The tariffs have raised tens of billions of dollars in revenue and were justified by the White House as tools to address trade imbalances, supply chain vulnerabilities, and the fentanyl crisis.

Businesses that paid these now-invalidated charges are expected to pursue refund claims, though trade lawyers caution that the refund process could be complex and protracted, involving protests with US Customs and Border Protection and litigation in the US Court of International Trade and beyond.

Conservative and liberal justices joined the majority. The dissent, led by Justice Brett Kavanaugh and joined by Justices Thomas and Alito, warned that the ruling could create uncertainty in global trade and complicate US leverage in negotiations.

It is expected that the US will seek to continue its tariffs, but via legal means ie Section 232. “We were indeed monitoring this decision. However, we expect the US administration to use other legal instruments to reinstate its tariffs,” a French diplomat told POLITICO.

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