The Supreme Court struck down President Donald Trump’s far-reaching global tariffs on Friday, handing him a significant loss on an issue crucial to his economic agenda.
The 6-3 decision centers on the tariffs Trump unilaterally imposed under an emergency powers law, including the sweeping “reciprocal” tariffs 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.
“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.
Tariff decision may have small inflation impact
Consumers probably won’t see much reduction in overall prices as a result of the Supreme Court’s decision.
Inflation did not rise by as much as many economists expected when Trump announced his most sweeping tariffs in April. That’s partly because many of the “Liberation Day” duties were later rolled back, delayed or negotiated downward. Trump also exempted products such as beef, coffee and auto parts from his tariffs. And many large companies have eaten much of the cost, rather than pass them to consumers.
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Still, the Federal Reserve estimates that inflation is about a half-percentage point higher than it would be without the tariffs. Its preferred inflation gauge is still elevated, coming in at 2.9% in December from a year earlier. Over time, the decision could slightly reduce prices for cars, furniture, clothes and other items, where prices did rise after duties were imposed.
For some — not all — industries, decision provides relief
In a memo to its members Friday, the Home Furnishings Association noted that the decision leaves many Trump administration tariffs in effect, including those on steel, upholstered furniture, kitchen cabinets and bathroom vanities. Certain tariffs on products from China also remain in place, the association said.
“As always, our advocacy is focused on promoting trade policies that provide stability, predictability, and fairness—protecting retailers from unnecessary financial burdens while supporting strong, competitive supply chains that benefit businesses and consumers alike,” said the association, which represents 15,000 furniture stores in North America.
Steelworkers urge Congress to revamp trade
The Pittsburgh-based United Steelworkers, the labor union whose members work at U.S. Steel and Cleveland-Cliffs plants, urged Congress to revamp the U.S. trade system by using tariffs “strategically.”
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It said tariffs should be used to protect American workers, not to punish allies like Canada. It also called on Congress to restore funding to programs to help American workers who lose their jobs because of unfair foreign trade.
“It’s an excess of short-term thinking and free trade ideology that got us into this mess. Now, we need sustainable solutions,” the union said in a statement.
The U.S. steel industry has enjoyed a period of expansion under tariffs adopted by the Biden and Trump administrations, analysts say.
Technology trade groups hail decision
Tech advocates predicted the decision will help minimize price increases and disruptions in the intricate supply chains for the computers, smartphones, televisions and other gadgets ingrained in modern life.
“Innovation thrives on predictability, and this common-sense decision brings much-needed clarity for American businesses and consumers,” said Gary Shapiro, CEO of the Consumer Technology Association, which represents more than 2,000 companies. “Now, the government must act quickly to refund retailers and importers without red tape or delay.”
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The Computer & Communications Industry Association, which represents a spectrum of technology companies employing more than 1.6 million people, also expressed hope that the decision will ease the trade tensions that have been tormenting tech.
“This Supreme Court decision caps a year of turbulence in trade policy that we are all working to adapt to. With this decision behind us, we look forward to bringing more stability to trade policy,” said Jonathan McHale, the Computer & Communications Industry Association’s vice president for digital trade.
Poll: Americans felt Trump overstepped on tariffs
About 6 in 10 Americans said Trump had “gone too far” on imposing new tariffs on other countries, according to an AP-NORC poll from January.
About 9 in 10 Democrats and roughly 6 in 10 independents said Trump had overstepped, compared to 25% of Republicans.
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The tariffs have been unpopular for much of Trump’s first year back in office. Roughly half of U.S. adults said they were opposed to imposing tariffs on all goods brought into the U.S. in an AP-NORC poll from last April. Only about 3 in 10 favored them, and roughly 2 in 10 were neutral.
Possibly more worrisome for a president elected on the promise of fixing Americans’ affordability concerns, 76% in the April poll thought Trump’s tariff policies would increase the cost of U.S. consumer goods.
Which of Trump’s tariffs are struck down?
Friday’s decision upends a core set of tariffs that Trump imposed using the 1977 International Emergency Economic Powers Act, or IEEPA. That includes the “Liberation Day” tariffs the president slapped on nearly every country in the world last spring — as well as other IEEPA-based levies he imposed on Canada, Mexico and China. Trump also cited IEEPA to impose additional tariffs on Brazil over the trial of former President Jair Bolsonaro, and on India over its purchases of Russian oil.
Tariffs, stock turmoil have Pittsburghers adjusting or avoiding plans for the future
Despite Friday’s ruling, other sweeping levies remain in place. Trump used another law — Section 232 of the 1962 Trade Expansion Act — to slap sectoral tariffs on steel and aluminum, cars, copper, lumber and products like kitchen cabinets worldwide. And the president has plenty of other options to keep taxing imports aggressively.
Trump still has other tariff options
President Trump still has options to keep taxing imports aggressively even after the Supreme Court struck down the tariffs he imposed last year on nearly every country on earth.
The Justices didn’t buy the president’s sweeping claims of authority to impose tariffs as he sees fit. But Trump can re-use tariff powers he deployed in his first term and can reach for others, including one that dates back to the Great Depression.
“It’s hard to see any pathway here where tariffs end,” said Georgetown trade law professor Kathleen Claussen. “I am pretty convinced he could rebuild the tariff landscape he has now using other authorities.”
