Supreme Court Strikes Down Major Portion of Trump’s Tariff Agenda

The U.S. Supreme Court on Friday invalidated a significant part of President Donald Trump’s expansive tariff program, ruling that the law used to justify many of the duties does not grant the president authority to impose tariffs. The decision, delivered in a 6–3 ruling, marks a major setback for one of the administration’s most prominent economic tools.

Chief Justice John Roberts authored the majority opinion. Justices Clarence Thomas, Samuel Alito, and Brett Kavanaugh dissented.

Since returning to the White House, Trump has reshaped U.S. trade policy by imposing a wide range of tariffs affecting nearly every major trading partner. Many of these duties were enacted under a broad interpretation of the International Emergency Economic Powers Act (IEEPA)—a statute that allows the president to regulate certain foreign transactions during a declared national emergency. Although IEEPA does not explicitly mention tariffs, the administration argued that its language permitted the imposition of import duties.

Critics challenged that interpretation, contending that the law does not allow the president to unilaterally levy tariffs of any size on any country. Both a federal trade court and a federal appeals court previously ruled the IEEPA‑based tariffs unlawful before the case reached the Supreme Court.

A substantial share of U.S. tariff revenue last year came from duties imposed under IEEPA. These included Trump’s near‑global “reciprocal” tariffs and separate measures tied to allegations of drug trafficking into the United States. Additional IEEPA‑based tariffs targeted Mexico, Canada, and China over concerns related to fentanyl.

Trump has long defended tariffs as a powerful negotiating tool and a major source of federal revenue. He has argued that foreign countries bear the cost of the duties, though the administration has acknowledged that U.S. importers pay them. Trump has even suggested that tariff revenue could replace the income tax and floated the idea of issuing $2,000 “tariff dividend” checks to Americans.

Revenue estimates, however, vary widely. While Trump claimed the U.S. would soon receive more than $600 billion in tariffs, the Bipartisan Policy Center estimated gross tariff revenue at roughly $289 billion in 2025. U.S. Customs and Border Protection reported collecting about $200 billion between January 20 and December 15, with IEEPA‑specific tariffs accounting for approximately $129 billion as of December 10.

Ahead of the ruling, Trump warned of severe consequences if the Court struck down the tariffs, calling the policy a “National Security bonanza.” Senior officials, including Treasury Secretary Scott Bessent, had expressed confidence that the Court would uphold the administration’s approach.

The ruling adds another layer of uncertainty to an already complex trade landscape. Trump’s reciprocal tariffs, unveiled last April during an event he labeled “Liberation Day,” triggered market volatility and have since undergone multiple revisions, delays, and reinstatements.

The decision underscores the limits of executive authority in trade policy and raises questions about the future of the administration’s tariff strategy, which has played a central role in its economic agenda.