• President vows alternative ways to impose levies as court declared his tariff regime ‘illegal’
• Trump insists ‘India deal is on’
• Three liberal justices joined three conservatives in Friday’s ruling
• Canada hails ruling, UK, Germany cautious in their response
• Stocks rise, Treasury yields gain after the verdict
WASHINGTON: After the US Supreme Court struck down the President’s sweeping tariffs that he pursued under a law meant for use in national emergencies, Donald Trump announced on Friday he was imposing an extra global tariff of 10 per cent on US trade partners.
The conservative-majority court ruled the emergency powers law — International Emergency Economic Powers Act (IEEPA) — “does not authorise the President to impose tariffs”, marking Trump’s biggest defeat at the SC since returning to the White House last year.
While hard-hit Canada welcomed the ruling pointing out the levies were always “unjustified”, other US trading partners particularly European powers were cautious in their response, with the UK, Germany and EU stating that they were in contact with the Trump administration and analysing the court decision ‘carefully’.
Trump insisted he would impose tariffs “using alternative authorities” after rebuking certain members of the court for lacking the courage to do what’s right for the country.
He suggested that most trade deals negotiated under the threat of his tariffs remained valid, mentioning specifically India, despite the SC ruling those levies illegal. “The India deal is on,” Trump told reporters in response to a question, while suggesting tariffs under separate authorities would replace the ones overturned by the court. “All the deals — we’re just going to do it a different way.”
“In order to protect our country, a president can actually charge more tariffs than I was charging in the past,” the president asserted.
“The Supreme Court’s decision today made a president’s ability to both regulate trade and impose tariffs more powerful and more crystal clear, rather than less,” he claimed while speaking to reporters after the 6-3 ruling upheld a lower court’s decision that the Republican president’s use of the 1977 law “exceeded his authority”.
Trump has leveraged tariffs — taxes on imported goods — as a key economic and foreign policy tool. They have been central to a global trade war that Trump initiated after he began his second term as president, one that has alienated trading partners, affected financial markets and caused global economic uncertainty.
Trump’s tariffs were forecast to generate over the next decade trillions of dollars in revenue for the United States, which possesses the world’s largest economy.
However, Trump’s administration has not provided tariffs collection data since Dec 14, 2025.
Powers to issue taxes, tariffs
The Supreme Court reached its conclusion in a legal challenge by businesses affected by the tariffs and 12 US states, most of them Democratic-governed, against Trump’s unprecedented use of this law to unilaterally impose the import taxes.
The US Constitution grants Congress, not the president, the authority to issue taxes and tariffs. But Trump instead turned to a statutory authority by invoking IEEPA to impose the tariffs on nearly every US trading partner without the approval of Congress.
“Had Congress intended to convey the distinct and extraordinary power to impose tariffs” with IEEPA, “it would have done so expressly, as it consistently has in other tariff statutes,” the court noted
The SC’s three liberal justices joined three conservatives in Friday’s ruling, which upheld lower court decisions that tariffs Trump imposed under IEEPA were illegal.
Trump heaped praise on Brett Kavanaugh, the only justice he nominated who voted with him. Kavanaugh was joined in his dissent by fellow conservatives Clarence Thomas and Samuel Alito.
Chief Justice John Roberts, in delivering his opinion, said, “IEEPA contains no reference to tariffs or duties.”
Trump has imposed some additional tariffs under other laws that are not at issue in this case. Based on government data from October to mid-December, those represent about a third of the revenue from Trump-imposed tariffs.
IEEPA lets a president regulate commerce in a national emergency.
Trump became the first president to use IEEPA to impose tariffs, one of the many ways he has aggressively pushed the boundaries of executive authority since he returned to office in areas as varied as his crackdown on immigration, the firing of federal agency officials, domestic military deployments and military operations overseas.
He described the tariffs as vital for US economic security, predicting that the country would be defenseless and ruined without them.
Post-ruling strategy
In November, Trump told reporters that without his tariffs “the rest of the world would laugh at us because they’ve used tariffs against us for years and took advantage of us”. He said the United States was abused by other countries, including China, the second-largest economy.
After the SC heard arguments in the case in November, Trump said he would consider alternatives if it ruled against him on tariffs, telling reporters that “we’ll have to develop a ‘game two’ plan”.
Treasury Secretary Scott Bessent and other administration officials said the US would invoke other legal justifications to retain as many of Trump’s tariffs as possible.
Among others, these include a statutory provision that permits tariffs on imported goods that threaten US national security and another that allows retaliatory actions, including tariffs against trading partners that the Office of the US Trade Representative determines have used unfair trade practices against American exporters.
None of these alternatives offered the flexibility and blunt-force dynamics that IEEPA provided Trump, and may not be able to replicate the full scope of his tariffs in a timely fashion.
Trump’s ability to impose tariffs instantaneously on any trading partner’s goods under the aegis of some form of declared national emergency raised his leverage over other countries.
It brought world leaders scrambling to Washington to secure trade deals that often included pledges of billions of dollars in investments or other offers of enhanced market access for US companies.
But Trump’s use of tariffs as a cudgel in US foreign policy has succeeded in antagonising numerous countries, including those long considered among the closest US allies.
IEEPA historically had been used for imposing sanctions on enemies or freezing their assets, not to impose tariffs. The law does not specifically mention the word tariffs.
Estimates
Penn-Wharton Budget Model economists estimated that the amount collected in Trump’s tariffs based on the International Emergency Economic Powers Act stood at more than $175 billion. And that amount likely would need to be refunded with a Supreme Court ruling against the IEEPA-based tariffs.
The Congressional Budget Office has estimated that if all current tariffs stay in place, including the IEEPA-based duties, they would generate about $300bn annually over the next decade.
Total US net customs duty receipts reached a record $195bn in fiscal 2025, which ended on Sept 30, according to US Treasury Department data.
In February and March of 2025, Trump invoked IEEPA to impose tariffs on China, Canada and Mexico, citing the trafficking of the often-abused painkiller fentanyl and illicit drugs into the United States as a national emergency.
Trump has wielded his tariffs to extract concessions and renegotiate trade deals, and as a weapon to punish countries that draw his ire on non-trade political matters. These have ranged from Brazil’s prosecution of former president Jair Bolsonaro, India’s purchases of Russian oil that help fund Russia’s war in Ukraine, and an anti-tariffs ad by Canada’s Ontario province.
Reactions to ruling
The EU said on Friday that it was studying the US Supreme Court ruling. “We take note of the ruling … and are analysing it carefully,” EU trade spokesman Olof Gill said.
“We remain in close contact with the US Administration as we seek clarity on the steps they intend to take in response to this ruling,” he added.
“Businesses on both sides of the Atlantic depend on stability and predictability in the trading relationship”.
The British government spokesperson said Britain planned to work with the US to see how the overturning of Trump’s tariffs by the US Supreme Court would affect the trade deal between the two countries. “We will work with the administration to understand how the ruling will affect tariffs for the UK and the rest of the world,” the spokesperson said, adding that the UK expects its “privileged trading position with the US to continue”.
The Canadian minister responsible for US trade said the US Supreme Court’s ruling affirms that the levies were “unjustified”.
International Trade Minister Dominic LeBlanc noted, however, that tariffs causing the most pain in Canada — sector-specific measures affecting the steel, aluminum and auto industries — remained in force despite the ruling, promising Ottawa would work with Washington to “create growth and opportunities on both sides of the border”.
After the ruling, stock markets rose in the United States and Europe, led by shares of affected companies, including Europe’s luxury brands from LVMH to Hermes and Italian luxury outerwear group Moncler, all of which rose after the ruling.
Stocks rise
US and European stocks advanced on Friday and Treasury yields rose as investors absorbed the Supreme Court ruling, while also parsing a weak GDP report and higher-than-expected inflation data.
All three major US stock indexes moved higher immediately following the Supreme Court’s decision. The S&P 500 and the Nasdaq are on track to notch weekly gains, while the blue-chip Dow is currently flat versus last Friday’s close.
Europe’s STOXX 600 index extended gains following the ruling while gold prices came off the day’s highs in the immediate aftermath.
US Treasury yields rose following the Supreme Court’s ruling. The yield on benchmark US 10-year notes added 1.9 basis points to 4.094pc, from 4.075pc late on Thursday.
The dollar turned lower after the top US court’s tariff decision, but was still on track for its biggest weekly gain since October.
Published in Dawn, February 21st, 2026
from Dawn - Home https://ift.tt/AINFZzL
0 Comments