A federal appeals court has ruled most of Trump’s sweeping tariffs illegal, setting up a Supreme Court battle that could redefine presidential trade powers.
At a Glance
- A 7–4 appeals court ruling declared most Trump tariffs unlawful
- The decision is stayed until October 14 to allow Supreme Court review
- Treasury eyes fallback options if high court overturns tariffs
- U.S. still pushing forward on trade talks despite legal setback
Appeals Court Ruling
The U.S. Court of Appeals for the Federal Circuit ruled in a 7–4 decision that former President Donald Trump’s sweeping tariffs, imposed under the International Emergency Economic Powers Act (IEEPA), exceeded executive authority. The panel found that IEEPA was never intended to authorize blanket import tariffs, a move that judges said effectively rewrote trade law.
Despite the ruling, the court stayed enforcement until October 14. That gives the administration a window to appeal to the Supreme Court, ensuring that tariffs remain in effect while the justices weigh whether to hear the case.
Watch now: Federal appeals court strikes down Trump’s sweeping tariffs
Treasury Response and Legal Options
Treasury Secretary Scott Bessent said he expects the Supreme Court to uphold the tariffs, pointing to broad presidential latitude in national security and economic emergencies. At the same time, Bessent acknowledged that contingency plans are being prepared should the justices rule otherwise.
One option under review is invoking Section 338 of the Smoot-Hawley Tariff Act of 1930, a rarely used statute that could provide a legal foundation for new duties. Bessent emphasized that while confidence in the Supreme Court outcome remains high, the administration is preparing fallback measures to maintain leverage in trade negotiations.
Trade Policy Outlook
The U.S. Trade Representative confirmed that talks with global partners are continuing despite the appeals court ruling. Officials stressed that trade diplomacy remains active and that the administration intends to pursue agreements while the legal process unfolds.
The outcome of the Supreme Court case could reshape U.S. trade policy for decades. A ruling against Trump’s tariff authority would significantly narrow presidential powers under IEEPA, while an affirmation could entrench sweeping executive discretion over trade. Either decision is likely to reverberate through global markets and international negotiations.