IN A major blow to US President Donald Trump’s signature economic policy, the US Supreme Court on Friday invalidated most of his sweeping tariff measures. According to ‘The Washington Post’, the US apex court held that the US President did not possess the authority under the 1977 International Emergency Economic Powers Act (IEEPA) to impose extensive import duties on goods from nearly all US trading partners. The 6-3 decision centres on tariffs imposed under an emergency powers law, including the sweeping “reciprocal” tariffs he levied on nearly every other country. It’s the first major piece of Trump’s broad agenda to come squarely before the nation’s highest court, which he helped shape with the appointments of three conservative jurists in his first term.

 

The majority found that the Constitution “very clearly” gives Congress the power to impose taxes, which include tariffs. “The Framers did not vest any part of the taxing power in the Executive Branch,” Chief Justice John Roberts wrote. Justices Samuel Alito, Clarence Thomas and Brett Kavanaugh dissented. “The tariffs at issue here may or may not be wise policy. But as a matter of text, history, and precedent, they are clearly lawful,” Kavanaugh wrote in the dissent. The ruling is expected to have wide-ranging consequences for global trade, businesses, consumers, inflation trends and household finances across the country.

 

The verdict marks a notable shift from a series of recent wins for Trump at the Supreme Court. Over the past year, the justices had largely sided with the administration in interim orders, allowing policies such as a ban on transgender troops serving in the military, granting the United States DOGE Service access to sensitive data, and enabling significant cuts to the Education Department while legal challenges continued, ‘The Post’ reported. The financial implications of the ruling are substantial. The tariffs in question cover trillions of dollars in trade, and the US government collected nearly USD 134 billion in levies through December 14 under the contested authority. According to estimates by the Tax Foundation, Trump’s trade war will cost American households approximately USD 1,100 each in 2025, ‘The Post’ reported. The judgement came days after the United States and India announced that they have reached a framework for an Interim Agreement regarding reciprocal and mutually beneficial trade.

 

The tariffs decision doesn’t stop Trump from imposing duties under other laws. While those have more limitations on the speed and severity of Trump’s actions, top administration officials have said they expect to keep the tariff framework in place under other authorities. The Supreme Court ruling comes despite a series of short-term wins on the court’s emergency docket that have allowed Trump to push ahead with extraordinary flexes of executive power on issues ranging from high-profile firings to major federal funding cuts. The Republican President has been vocal about the case, calling it one of the most important in US history and saying a ruling against him would be an economic body blow to the country. 

 

 

“THE Supreme Court’s ruling is ‘deeply disappointing’ and I am ashamed of certain members of the court for not having the courage to do what is right for our country," Trump said at the White House media briefing on Friday. “Their decision is incorrect,” he said. Furious about the defeat, Trump said he will impose a global 10 per cent tariff as an alternative while pressing his trade policies but said that there will be no change in India-US trade deal. “Income coming in from tariffs will increase. The new tariffs would come under a law that restricts them to 150 days,” Trump said. “Supreme Court made my ability to impose tariffs more powerful,” he added, arguing that the ruling had clarified his options rather than restricted them. “I will go in a stronger direction now,” Trump said, signalling potential escalation in his trade strategy. At one point, the President remarked, “I could do anything I want to do but I can’t charge any money,” while also asserting, “I am allowed to impose an embargo.”