The US Supreme Court has deemed a significant portion of the import duties imposed under President Donald Trump illegal. The conclusion was distributed based on court decision materials: the fact is that the administration relied on the 1977 IEEE - International Law on Extraordinary Economic Powers - to introduce comprehensive tariffs without the direct consent of Congress, and the court assessed this as an abuse of power.
What did the court say?
According to the position of most judges, the IEEPA does not give the president the authority to bypass legislative power and massively "tax" goods coming from practically all over the world. That is, the tariff is not just a foreign trade "button," but a major decision that should be under the control of Congress from the point of view of the Constitution and laws.
Which duties are being abolished?
The decision mainly concerns broad "global/reciprocal" and "response" tariffs targeting imports from dozens of countries. They were explained by such goals as reducing the trade deficit and increasing pressure on partners. Also, some tariffs introduced on the basis of the "national emergency" were hampered because they were within the framework of the IEEE.
What about money?
The most interesting thing is the economic consequences. According to analysts' calculations, the previously accumulated tariff revenues of more than $175 billion fall into the category of "claimed funds." This decision increases the likelihood of opening legal doors for importers to demand compensation/return. However, the current process will not be easy - there are separate cases, technical calculations, and procedures.
Why is this decision so important?
This decision effectively reduces the president's ability to single-handedly implement large-scale trade restrictions based on an "urgent" law. Therefore:
- imported goods can influence pricing policy and supply chains;
- In US trade policy, the "I said it" style is limited;
- The White House can now try to find a new mechanism to restore tariffs through other laws or Congress.
In short, this decision is a major turning point on the trade front. The issue of tariffs will now continue for a long time in the political, economic, and judicial spheres. The new season of "Trade War" has just begun - but now everyone writes the script together.
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