SCOTUS strikes down Trump's tariff agenda - The Oracle

Photo Via World Economic Forum

In April 2025, Trump announced sweeping tariffs, affecting the United States’ international economic relationships.

On Feb. 20, the Supreme Court proved once again executive power is not absolute after striking down President Donald Trump’s sweeping tariffs in a 6-3 decision.

Trump’s war on the U.S. trade deficit came to a brief halt after the Supreme Court ruled in Learning Resources v. Trump that the president cannot use the International Emergency Economic Powers Act (IEEPA) to impose tariffs.

The IEEPA, enacted in 1977, authorizes the U.S. president to regulate commerce, impose sanctions or freeze assets during a declared national emergency stemming from foreign threats.

The power to impose tariffs falls upon Congress, not the president. Article One, Section Eight of the U.S. Constitution states Congress has the power, “To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes.”

The court ruled that the president doesn’t have the power to enact tariffs, and Trump’s interpretation of the IEEPA was wrong.

“Based on two words separated by 16 others in Section 1702(a)(1)(B) of IEEPA – ‘regulate’ and ‘importation’ – the president asserts the independent power to impose tariffs on imports from any country, of any product, at any rate, for any amount of time,” wrote the court in Learning Resources v. Trump.

Photo Via CT Mirror

The Supreme Court struck down Trump’s sweeping tariffs in a 6-3 decision.

“Those words cannot bear such weight.”

Now, President Trump looks to change up his strategy after being dealt a major blow by the Supreme Court.

On Feb. 20, following the Supreme Court’s ruling, President Trump signed a new executive order imposing a 10% global tariff under the authority of the Trade Act of 1974.

The Trade Act gives the president the authority to impose tariffs of up to 15% for a period of 150 days to respond to trade deficits. After 150 days, congressional approval is required for the tariffs to remain.

This gives the Trump administration time to regroup and develop a long-term strategy for the new trade war, but it must first address the fallout from the initial round of tariffs.

According to the Bipartisan Policy Center, the U.S. brought in $289 billion in revenue from gross tariffs and certain other excise taxes in 2025.

All the revenue collected from President Trump’s illegal tariffs will likely have to be paid back to corporations and potentially consumers.

Some companies have filed claims against the United States seeking refunds, but due to the Supreme Court not providing guidance on how those refunds should be distributed, new questions have emerged about the process and who should ultimately receive the money.

Democratic lawmakers have introduced the Payback Act, which would direct the Secretary of the Treasury to refund American consumers.

With President Trump’s trade war running out of time and uncertainty over refunds hanging over his head, he must now look for new options if he intends to continue his economic agenda.