The Supreme Court is preparing to decide whether former President Donald Trump’s sweeping tariffs on global trade partners were constitutional, after justices signaled deep skepticism during arguments Wednesday about whether the measures violated congressional authority.
The case challenges Trump’s use of the International Emergency Economic Powers Act to impose so-called reciprocal tariffs on imports from dozens of nations, including Canada, China, and Mexico, as well as separate duties tied to the enforcement of fentanyl regulations. Lower courts have ruled that Trump exceeded his executive powers, finding that the law did not permit the imposition of tariffs without congressional approval.
During more than two hours of argument, both conservative and liberal justices questioned the administration’s claim that the tariffs were justified under emergency powers. Several justices raised concerns that such unilateral trade actions could erode the separation of powers by allowing the executive branch to collect revenue without Congress.
The disputed tariffs range from 10% for many countries to as high as 50% for certain imports from India and Brazil. The Committee for a Responsible Federal Budget estimates that it would generate $3 trillion in additional revenue by 2035 if allowed to stand. Federal customs data show that the government collected $151 billion in duties in the second half of fiscal 2025, nearly three times more than during the same period a year earlier.
Attorneys for the plaintiffs argued that the Constitution grants Congress, not the president, the sole authority to tax, and that tariffs serve as a form of taxation. They also pointed to inconsistencies in Trump’s trade rationale, including tariffs against allied countries with which the United States runs trade surpluses.
Treasury Secretary Scott Bessent, who attended the hearing, has warned that a ruling against the administration could force the government to refund more than $750 billion in tariff revenue.
The court’s decision, expected in the coming months, could redefine the limits of presidential power over international trade and determine whether future presidents can use emergency powers to reshape tariff policy without congressional action.
Source: CNBC