Supreme Court weighs Trump tariffs in a trillion-dollar test of executive power

Supreme Court to Decide on Trump’s Tariff Powers in Landmark Case

The Supreme Court will hear arguments Wednesday in a pivotal case challenging President Donald Trump’s authority to unilaterally impose wide-ranging tariffs, a decision that could have profound implications for the global economy and presidential power.

At the heart of the dispute is whether Trump overstepped his authority when he invoked the 1977 International Emergency Economic Powers Act (IEEPA) to impose tariffs on imports from multiple countries. Lower courts have already ruled against the administration, stating that the emergency law doesn’t grant the president such extensive tariff powers.

The Constitution explicitly assigns Congress the power to levy tariffs, but the Trump administration contends that in emergency situations, the president can regulate importation and impose duties. Trump has described the case as among the most important in American history, warning that a ruling against him would be “catastrophic for the economy.”

The legal challenge focuses on two sets of tariffs: those imposed in February on imports from Canada, China, and Mexico following Trump’s declaration of a national emergency over drug trafficking, and the sweeping “reciprocal” tariffs announced in April affecting most countries.

Multiple lawsuits have been filed by Democratic-leaning states and small businesses spanning diverse sectors from plumbing suppliers to women’s cycling apparel manufacturers. These challengers argue that the IEEPA doesn’t even mention tariffs, and no previous president has ever used this law to impose them. Some small business owners claim the resulting economic uncertainty has pushed them to the brink of bankruptcy.

The case arrives at a court shaped significantly by Trump himself, who appointed three of the current justices during his first term. Yet the outcome remains uncertain. While the conservative-majority court has been reluctant to check Trump’s executive power in emergency docket cases, this represents the first time much of his wide-ranging agenda has been fully argued before the nation’s highest court.

Legal experts note parallels to the court’s decision in the Biden student loan forgiveness case. There, justices rejected then-President Joe Biden’s attempt to forgive $400 billion in student loans under a different emergency powers law, citing the “major questions doctrine” – the principle that Congress must clearly authorize executive actions with substantial economic impact.

Challengers argue Trump’s tariffs warrant the same treatment, as they would have a far greater economic footprint – potentially raising $3 trillion over the next decade. The administration counters that tariffs differ because they’re central to foreign affairs, an area where courts traditionally defer to presidential authority.

The legal challenge also invokes the “nondelegation doctrine,” a concept many conservative justices have shown interest in reviving. This principle questions whether the Constitution allows other parts of government to exercise powers specifically reserved for Congress. Challengers contend that Trump’s broad interpretation of IEEPA could effectively mean anyone with regulatory authority could impose taxes.

The Justice Department responds that this legal principle applies to governmental agencies, not the president directly.

A ruling against Trump wouldn’t completely eliminate his ability to impose tariffs, as other laws provide such authority, albeit with more limitations on scope and implementation speed. However, a loss could create complex administrative challenges, potentially requiring the government to refund tariffs that had generated $195 billion in revenue as of September.

The administration did find support from four appeals court judges who determined that IEEPA grants the president authority to regulate importation during emergencies without explicit limitations. In recent decades, Congress has gradually ceded some tariff authority to the executive branch, creating a power vacuum that Trump has aggressively filled.

The Supreme Court’s decision, expected by June, could set a significant precedent for executive power limits and reshape America’s trade policy landscape for decades to come.