The Supreme Court struck down President Trump’s most sweeping tariffs on Friday, ruling 6-3 that he overstepped his authority when using an emergency powers law to justify new taxes on goods from nearly every country in the world.
The decision dismantles tariffs Trump imposed under the 1977 International Emergency Economic Powers Act, or IEEPA, a law that authorizes the president to broadly regulate commerce after declaring a national emergency. Presidents have invoked IEEPA dozens of times over the years, typically to impose sanctions on other countries. Trump was the first to use it to implement tariffs.
Many sector-specific levies remain in place, and Trump has already signaled he will pursue other import taxes, including a planned 10% global tariff.
The Liberation Day tariffs
On April 2, which Trump called Liberation Day, he imposed reciprocal tariffs of up to 50% on goods from dozens of countries and a baseline 10% tariff on nearly all others. Most of the higher rates took effect in August after several months of delays and revisions following trade negotiations.
Trump cited the long-running gap between U.S. exports and imports to justify these tariffs. Major trading partners affected included the European Union, Japan and South Korea. Ahead of Friday’s decision, the U.S. applied 15% tariffs on most goods from these trading partners, though Trump had threatened to raise rates on certain South Korean products to 25%.
Strategic tariffs on key trading partners
At the start of his second term, Trump used IEEPA to impose new tariffs on America’s three largest trading partners: Mexico, Canada and China. He justified these levies by declaring a national emergency over undocumented immigration and trafficking of fentanyl and precursor chemicals.
Before Friday’s decision, these “trafficking tariffs” stood at 35% on Canadian imports and 25% on Mexican imports for goods that did not comply with the 2020 United States-Mexico-Canada trade agreement. China faced a 10% fentanyl-related tariff, down from 20% earlier.
Trump also used IEEPA to impose additional tariffs on Brazil, citing the country’s policies and the prosecution of former President Jair Bolsonaro. Brazil faced a 40% tariff added to the baseline 10%, bringing total levies to 50% on many products, despite the U.S. maintaining a consistent trade surplus with the country.
India similarly faced a 25% tariff following Liberation Day, plus an additional 25% for its purchases of Russian oil, totaling 50%. Earlier this month, the U.S. and India reached a trade framework agreement. Prime Minister Narendra Modi agreed to stop buying Russian oil, and Trump said he planned to reduce U.S. tariffs on India to 18%. India said it would eliminate or reduce tariffs on all U.S. industrial goods and a range of agricultural products.
The tariffs that remain
The Supreme Court decision does not eliminate all Trump tariffs. Using Section 232 of the 1962 Trade Expansion Act, Trump has imposed duties on steel, aluminum, cars, copper and lumber worldwide, citing national security concerns. He expanded Section 232 tariffs in September to cover kitchen cabinets, bathroom vanities and upholstered furniture.
Trump has also rolled back some tariffs in recent months under pressure to lower rising prices. These rollbacks included adding exemptions to specific levies and scrapping import taxes on goods like coffee, tropical fruit and beef.
What Trump plans next
Following Friday’s decision, Trump said he would sign an executive order to enact a 10% global tariff using Section 122, another federal law. Those tariffs would be limited to 150 days unless extended legislatively.
Trump indicated he would continue pursuing sectoral levies to reshape U.S. trade relationships, leaving him with a narrower but still significant array of tariff tools despite the Supreme Court’s rebuke.