The Supreme Court of the United States (US) dealt a decisive blow to President Donald Trump's economic agenda by striking down the “Liberation Day” tariffs in a 6-3 vote. The tariffs, however, have not gone away entirely.
Some of the tariffs have been revoked, while some remain. The apex court in its decision said that IEEPA, a law designed to address genuine national emergencies, does not in any way authorise the imposition of wide-ranging tariffs unilaterally.
The court emphasised that the authority of tariff-setting rests with the US Congress, not the executive branch. The verdict is being seen as a significant setback to a central pillar of Trump's trade policy, the experts have maintained.
The ruling could be seen as a welcome step and a relief to many countries across the world, but does not impact sector-specific duties that the President had separately imposed on imports of steel, aluminium, and various other goods.
The verdict only deals with the set of tariffs imposed using the IEEPA, including the “Liberation Day” tariffs that Trump had imposed on nearly every country in the world last year. It also upends other IEEPA-based levies imposed on Canada, Mexico, and China.
Several tariffs, including the ones Trump used section-232 of the 1962 Trade Expansion Act to impose, remain in place. These tariffs have been slapped mainly on steel, aluminium, cars, copper, lumber, and products like kitchen cabinets worldwide.
Here is a list of tariffs that stand upended by the Supreme Court verdict
- The 10% ‘baseline' tariff on all trading partners (Liberation Day Tariffs)
- Higher ‘reciprocal' tariffs on dozens of countries
- Drug trafficking tariffs on Canada, Mexico, and China
What remains of the tariffs?
- Section 232 tariffs: Section 232 tariffs are import duties imposed under the Trade Expansion Act of 1962.
- Section 301 tariffs: Section 301 tariffs are punitive duties imposed by the US Trade Representative (USTR) under the Trade Act of 1974, targeting foreign trade practices deemed unfair.
The US Treasury had already collected more than $133 billion from import taxes that Trump had imposed under the emergency powers law as of December, federal data shows. The collection for the next decade was estimated to be $3 Trillion.
In the US, meanwhile, Democratic senators have welcomed the court striking down the tariffs. Assistant Minority Leader Dick Durbin, D-Illinois, said that the policy was “misguided” and created a burden on families as well as businesses.
“This ruling is a win for the American people, and in a rare instance, shows the Supreme Court can use its constitutional authority to stop the corruption and chaos of the Trump Presidency,” Durbin said in a statement, and was quoted by the news outlet USA Today.
Trump, meanwhile, was notified of the decision in his morning meeting with Governors at the White House. He has called the Supreme Court decision a “disgrace”, the Associated Press has quoted people who had a firsthand account of the President's reaction to the verdict.
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