SCOTUS nullifies Trump’s tariffs

Fate of collected funds not mentioned in ruling

Maureen Groppe, Bart Jansen, Terry Collins and Medora Lee

USA TODAY

WASHINGTON − A furious President Donald Trump slammed the Supreme Court after a landmark decision striking down his power to impose sweeping tariffs.

“I’m ashamed of certain members of the court, absolutely ashamed for not having the courage to do what’s right for our country,” Trump said. The court on Feb. 20 tossed the tariffs that are the centerpiece of his economic policy and a major foreign policy tool – but that have also raised costs for consumers and businesses. It is the first major ruling against Trump’s controversial expansive view of presidential power.

“The President asserts the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope,” Chief Justice John Roberts wrote in the 6-3 opinion. “In light of the breadth, history, and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise it.”

Trump, Roberts concluded, cannot.

Justice Neil Gorsuch wrote a separate opinion stressing the importance of major policies like taxes and tariffs going through Congress.

“Through that process, the Nation can tap the combined wisdom of the people’s elected representatives, not just that of one faction or man,” he wrote. “And because laws must earn such broad support to survive the legislative process, they tend to endure, allowing ordinary people to plan their lives in ways they cannot when the rules shift from day to day.”

The president castigated the court for not spelling out what happens to the tens of billions of dollars the government has already collected.

“Wouldn’t you think they would have put one sentence in there saying, ‘Keep the money or don’t keep the money,’ right?” Trump said. “I guess it has to get litigated for the next two years.”

In a dissent joined by Justices Clarence Thomas and Samuel Alito, Justice Brett Kavanaugh called tariffs a “traditional and common tool to regulate importation” that the law gives to the president.

“The tariffs at issue here may or may not be wise policy,” Kavanaugh wrote. “But as a matter of text, history, and precedent, they are clearly lawful.”

And he said the majority’s decision “says nothing” about whether and how the government must return the billions of dollars already collected.

That process, Kavanaugh said, will likely be a “mess.”

Trump called the ruling a “disgrace” after the decision came during his meeting with state governors, Reuters reported.

Trump had been counting on the tariffs to boost the federal budget by more than $2 trillion over the next decade and bring manufacturing back to the United States.

That means the uncertainty about operating costs is likely to persist for retailers and other businesses even as they celebrate the decision that Trump can’t use a 1977 emergency powers law to sidestep a more complex and limited tariffs process laid out in other laws.

The 1977 International Emergency Economic Powers Act has historically been used to impose economic sanctions and other penalties on foreign countries. But the administration argued that the authority the law gives presidents to “regulate” importation in response to an “unusual and extraordinary threat” includes the power to impose tariffs.

Beginning in early 2025, Trump used the law to impose tariffs on almost all goods imported into the United States to reduce persistent trade deficits, which he said have hollowed out the nation’s manufacturing base.

Trump used other tariffs on goods imported from Mexico, Canada and China as leverage to get those countries to do more to stop fentanyl from coming into the United States.

Trump said he would immediately impose 10% temporary tariffs to replace the emergency tariffs the Supreme Court had overturned.

Congress has delegated the president the power to impose tariffs in other ways. For example, he’s used the 1962 Trade Expansion Act to impose tariffs on steel and aluminum based on Commerce Department investigations − which aren’t affected by the court’s decision.

Another path for tariffs is the 1974 Trade Act, for unfair trade practices that the U.S. trade representative investigates.

“All we’re doing is going through a little more complicated process,” he said.

Trump cited another section of the 1974 Trade Act for the 10% tariffs he planned to sign. The new tariffs apply to countries that send the United States more than they import, but that type of tariff lasts for only 150 days.

“We have tariffs. We just have them in a different way,” he said.

Tariffs are paid by companies when they import goods from other countries.

Even before the high court overturned Trump’s emergency tariffs, thousands of companies sued to recover the billions already collected, but government officials have said that government refunds will go out without the need for litigation.

Costco, Revlon and Goodyear were among the companies seeking refunds through lawsuits at the U.S. Court of International Trade. Small businesses said they had to take out loans, cancel expansion plans and freeze hiring to cope with tariffs.

“Today’s Supreme Court decision is a tremendous victory for America’s small businesses who have been bearing the crushing weight of these tariffs,” said Dan Anthony, executive director of the advocacy group We Pay the Tariffs.

Multiple small businesses and a dozen states with Democratic attorneys general sued the administration.

They argued that Trump stretched the word “regulate” beyond its plain meaning. If “regulate” means “tax,” they said, then a president “could tax everything from autos to zoos,” even though the Constitution gives Congress the power to raise revenue.

Contributing: Reuters