The Supreme Court scrambled the US trade landscape with a decision announced Friday striking down the centerpiece of President Trump’s second-term tariff program.
The 6-3 ruling in Learning Resources, Inc. v. Trump came just over one year into Trump’s second term and after skeptical questioning from key justices during oral arguments last November.
It appears set to immediately halt a massive section of Trump’s tariffs announced last year on “Liberation Day” using a 1977 law called the International Emergency Economic Powers Act (IEEPA). The law gives the president the ability to declare an economic emergency and take action but doesn’t specify tariffs as a remedy.
“IEEPA does not authorize the President to impose tariffs,” read the decision by Chief Justice John Roberts.
It was a complex ruling with varied opinions and dissents stretching to 170 pages. Roberts captured the central legal issue, writing that Trump had asserted “the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope.”
The text of the law, he wrote, “cannot bear such weight.”
The decision does not appear to address the question of eligibility for tariff refunds, which is likely to lead to a complex legal process for companies.
The ruling upholds two lower courts — including the US Court of International Trade — that previously found Trump did not have the authority to impose global tariffs under IEEPA.
Joining Roberts in the majority were Justices Neil Gorsuch and Amy Coney Barrett, who also wrote concurring opinions, alongside liberal justices Sonia Sotomayor, Ketanji Brown Jackson, and Elena Kagan.
Justices Samuel Alito, Clarence Thomas, and Brett Kavanaugh offered dissenting opinions after a conservative push to uphold Trump’s tariffs.
Trump has continued to float new tariff threats nearly weekly on a wide array of fronts, from countries doing business with Iran to new duties on French wine.
The central question for the court was whether the law implicitly empowers the president to impose tariffs or whether Trump’s action was an illegal usurpation of “the power of the purse” that is the responsibility of Congress as laid out in the Constitution.
During oral arguments in November, swing justices ask a series of skeptical questions, with Roberts asking perhaps the most pointed questions.
He posited that regardless of why a president makes his moves, “the vehicle is an imposition of taxes on Americans, and that has always been the core power of Congress.”