The High Court explicitly rejected Trump's tariff authorization claim, with a 6-3 ruling dealing a heavy blow to the White House's economic agenda.

A ruling by the U.S. Supreme Court has sharply halted President Donald Trump’s aggressive tariff policies. This legal battle over the International Emergency Economic Powers Act (IEEPA) not only involves hundreds of billions of dollars in tariff revenue but could also reshape America’s future trade and fiscal directions. When the Supreme Court ruled 6-3, clearly stating that the law “does not authorize the President to impose tariffs,” it delivered a significant blow to Trump’s tariff agenda.

Majority Opinion: IEEPA Does Not Authorize the President to Unilaterally Impose Tariffs

On Friday, the U.S. Supreme Court ruled that the legal basis supporting Trump’s broad tariff policies is invalid. Chief Justice John Roberts, representing the majority, stated that the International Emergency Economic Powers Act (IEEPA) “does not authorize the President to impose tariffs.”

The case was ultimately decided 6-3, with most justices recognizing that while IEEPA allows the President to regulate imports after declaring a national emergency to address “unusual and extraordinary threats,” the law itself does not explicitly mention “tariffs.” Therefore, interpreting it as granting authority to fully impose import taxes exceeds the law’s original intent.

The three dissenting justices were Clarence Thomas, Samuel Alito, and Brett Kavanaugh.

Trump’s Tariff Scope: Nearly Global Impact

Since returning to the White House, Trump has rapidly reshaped U.S. trade relations, implementing import tariffs covering almost every country in the world. The most controversial measures include “reciprocal tariffs” based on IEEPA and additional tariffs targeting drug issues.

The Trump administration argued that the authority to “regulate imports” under IEEPA sufficiently covers the imposition of tariffs, especially when national security threats are involved. Critics, however, pointed out that the law never explicitly grants the President the power to “impose tariffs of any scale at any time on any country.”

In fact, before the Supreme Court took up the case, both the Federal Trade Court and the Federal Circuit Court had already ruled that these IEEPA-based tariffs were illegal.

“Liberation Day” Sparks Market Panic

In April last year, Trump held a high-profile event at the White House to announce what he called “Liberation Day,” officially launching a comprehensive reciprocal tariff plan. The announcement was grandiose but quickly triggered market panic.

Amid stock market turbulence, some tariffs were temporarily suspended. However, subsequent policy adjustments, delays, and re-implementations have made U.S. trade policy more complex and unpredictable for businesses and investors.

Additionally, Trump used the fentanyl crisis as a reason to impose tariffs on Mexico, Canada, and China, accusing these countries of failing to effectively stop the flow of deadly drugs into the U.S.

The Numbers Battle: $600 Billion or $289 Billion?

Trump has long viewed tariffs as a negotiation tool and a “fiscal goldmine.” He repeatedly claimed that foreign countries would bear the cost of tariffs and downplayed concerns about rising prices for American consumers.

However, the Trump administration also acknowledged that tariffs are actually paid by U.S. importers.

On social media platform Truth Social, Trump stated, “We have collected, and will soon receive, over $600 billion in tariff revenue.”

Other data, however, paints a more conservative picture. The Policy Center estimates that U.S. tariff revenue will total about $289 billion in 2025. The U.S. Customs and Border Protection agency reported that from January 20 to December 15, approximately $200 billion was collected.

As for IEEPA-related tariffs, the government states that about $129 billion had been collected by December 10.

These discrepancies have led to skepticism about Trump’s claim that “tariffs can replace income taxes.” He even proposed issuing $2,000 “tariff dividends” to American citizens.

National Security Arguments Fail: White House Warnings in Advance

Before the ruling was announced, Trump and his team actively defended the policies, emphasizing that if the Supreme Court overturned tariffs, it would have serious consequences for national security and the economy.

On January 12, Trump posted a warning: “If the Supreme Court rules against us on this major national security issue, we are finished!”

Treasury Secretary Scott Bessent and other officials expressed confidence, believing the Supreme Court would not overturn measures seen as Trump’s “signature economic policy.”

However, the outcome showed that the Supreme Court did not adopt the broad interpretation favored by the administration.

Next Steps in the Tariff War: Policy Restructuring or New Approaches?

This ruling not only delivers a significant blow to Trump’s personal policies but also clarifies the boundaries of executive and congressional powers.

In the future, if a President wishes to impose tariffs on a large scale, they may need to seek explicit authorization from Congress rather than rely on an expanded interpretation of emergency powers.

For businesses and investors, this decision might improve policy transparency; however, for Trump, the space to use tariffs as diplomatic and fiscal tools has been substantially restricted by the Supreme Court.

Whether U.S. trade policy will revert to a traditional framework or face new legal and political struggles remains closely watched by markets and the global economy.

This article, “Supreme Court Explicitly Denies Trump’s Tariff Authorization Claim, 6-3 Ruling Deals Heavy Blow to White House Economic Strategy,” first appeared on ABMedia.