Global tariffs imposed by Trump deemed unconstitutional by federal appeals court
In a significant decision, a U.S. appeals court has ruled that former President Donald Trump did not have the authority under an emergency law to impose broad tariffs on imports. The ruling, however, does not take effect before October 14, 2025, allowing the government time to appeal to the Supreme Court.
The court's decision comes as a major legal blow to Trump's trade agenda. In February, Trump invoked the 1977 International Emergency Economic Powers Act to impose tariffs on Canada, Mexico, and China, citing illegal immigration and drug trafficking as reasons. He also imposed tariffs on almost all US trading partners in April, with up to 50% on countries with a trade deficit and 10% on others.
The court's ruling does not affect these tariffs, which remain in place until October. Trump has vowed to appeal the ruling, stating that if allowed to stand, it would "destroy the United States of America." The Trump administration could invoke levies under Section 232 of the Trade Expansion Act of 1962, which would require a Commerce Department investigation.
The court's ruling does not specify how it would affect the trade deal between the US and the EU. Trump has threatened to escalate the trade war with the EU, suggesting that the EU-US trade deal is far from over. However, in a move to ease tensions, Trump later suspended the reciprocal tariffs for 90 days to allow countries to negotiate trade agreements and reduce barriers to American exports.
The dissent from the judges concluded that the 1977 law is not an unconstitutional delegation of legislative authority. The court's ruling does not address the question of whether the EU-US trade deal breaks WTO rules.
The federal appeals court's decision is not the first time Trump's use of tariffs has been challenged in court. In 2018, the same court ruled that the President does not have the power to impose tariffs on steel and aluminium under the same law, a decision that was later upheld by the Supreme Court.
As the case moves forward, the outcome could have significant implications for Trump's trade policies and the future of U.S.-international trade relations.
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