Tariff Turmoil: The Fallout From The US Supreme Court’s Decision
We’ve just witnessed a momentous weekend for President Trump’s trade agenda following a decisive ruling by the United States Supreme Court, which struck down his so-called Liberation Day country tariffs.
In a 6–3 decision, the justices concluded that the International Emergency Economic Powers Act (IEEPA) did not grant the President authority to impose such sweeping tariffs. The Court held that the statute did not extend to measures of this breadth, dealing a significant setback to the administration’s trade policy.
President Trump responded furiously, denouncing the ruling as unlawful, misguided and unpatriotic. He also launched personal criticisms at several members of the Court, including some whom he had appointed during his presidency. However, within hours of the judgment, he pivoted to an alternative legal basis: Section 122 of the Trade Act 1974.
Invoking this provision, Trump introduced a 10 percent surcharge on imports worldwide, which is scheduled to take effect on 24 February 2026.
The new tariff can remain in place for up to 150 days without congressional approval. Any extension beyond that period would require the consent of Congress, an uncertain prospect after the House of Representatives recently rejected separate tariff proposals targeting Canada.
Importantly, not all existing duties are affected by the ruling. Tariffs imposed under different legal authorities — including those on steel, aluminium and motor vehicles — remain in force.
Questions also remain over revenues already collected under the invalidated measures. Estimates suggest that between $130 billion and $175 billion could be subject to refund. With no automatic repayment mechanism and more than 1,000 importers pursuing legal claims, companies may face protracted litigation.
The UK’s situation seems to be unchanged. A UK government spokesperson stated that they expect the UK’s 10% trade deal to continue, while US Trade Representative Jamieson Greer said that the US will continue to honour tariff agreements it has already finalised with a number of countries around the world, including the UK.
