How the Supreme Court Spared America

The ruling against Trump’s tariffs is a major victory for the constitutional separation of powers, rule of law, and millions of American consumers and businesses.

In a 6–3 decision yesterday, the Supreme Court rightly ruled that, under the International Emergency Economic Powers Act of 1977, the president does not have the power to “impose tariffs on imports from any country, of any product, at any rate, for any amount of time.” The ruling is a major victory for the constitutional separation of powers, rule of law, and millions of American consumers and businesses harmed by these tariffs.

This decision spared America from a dangerous, unconstitutional path. Under President Trump’s interpretation of the law, the president would have had nearly unlimited tariff authority, similar to that of an absolute monarch. That undermines basic constitutional principles. The Framers of the Constitution had sought to ensure that the president would not be able to repeat the abuses of English kings, who imposed taxes without legislative authorization.

The three cases decided yesterday (one of which I helped litigate as co-counsel for small businesses challenging the tariffs) all grew out of Trump’s April 2025 “Liberation Day” executive order that imposed 10 percent tariffs—supposedly justified by trade deficits—on almost every nation in the world, plus massive additional “reciprocal” tariffs against dozens, using authority the president claimed Congress had given him in IEEPA. The so-called “reciprocal” tariffs even targeted nations that impose no tariffs on U.S. imports, such as Israel and Switzerland. Trump also used IEEPA to impose massive 25 percent tariffs against Canada, Mexico, and China, ostensibly imposed in response to fentanyl inflows from those countries. (These tariffs were challenged in a case filed by 12 states, though not in ours.)

Trump’s position had multiple flaws. IEEPA does not even mention tariffs, nor any synonyms such as duties and imposts. The law does authorize the president to “regulate” certain types of international transactions in the event of an “emergency” that amounts to an “unusual and extraordinary threat” to the United States. But the tariff authority and the power to “regulate” foreign commerce are listed in separate clauses of the Constitution. And, as Chief Justice John Roberts noted in his opinion for the Court, the tariff authority is part of the power to tax, an authority the Framers of the Constitution carefully reserved to Congress because they had “just fought a revolution motivated in large part by ‘taxation without representation.’” Furthermore, during the previous nearly 50-year history of IEEPA, Roberts continued, “no President has invoked the statute to impose any tariffs—let alone tariffs of this magnitude and scope.”

Rogé Karma: Get ready for zombie tariffs

Tariffs can, of course, be used for “regulatory” purposes. The dissenting opinion joined by three of the Court’s conservative justices—Samuel Alito, Clarence Thomas, and Brett Kavanaugh—makes much of this point. But that does not mean they are themselves regulations. As Roberts emphasizes, “the U. S. Code is replete with statutes granting the Executive the authority to ‘regulate’ someone or something.” But that does not mean all such laws also delegate the power to tax. “Taxes, to be sure, may accomplish regulatory ends,” Roberts recognizes. “But it does not follow that the power to regulate something includes the power to tax it as a means of regulation.”

Three of the justices in the majority—Roberts, Neil Gorsuch, and Amy Coney Barrett—also concluded that the Trump administration’s interpretation of IEEPA goes against what has become known as the “major questions” doctrine, which requires Congress to “speak clearly” when authorizing the executive to make “decisions of vast economic and political significance.” Since 2021, the Supreme Court has used the doctrine to strike down several presidential initiatives, such as President Biden’s $430 billion student-loan-forgiveness policy and a COVID-era moratorium on evictions. As Roberts noted, the doctrine applies with particular force “where, as here, the purported delegation involves the core congressional power of the purse.” And, as he also points out, “the economic and political consequences of the IEEPA tariffs are astonishing,” to the point where they “dwarf those of other major questions cases.” Even the massive Biden loan-forgiveness plan seems small by comparison.

Roberts, Gorsuch, and Barrett rejected the argument that the doctrine does not apply because tariffs are a “foreign affairs” power. First and foremost, tariffs impose taxes that are paid by Americans, and thus they are not purely a matter of foreign policy. As Gorsuch pointed out in a concurring opinion, many claimed delegations of congressional power—including the powers to impose taxes and spend money, and Biden’s attempts to use emergency powers to combat the coronavirus pandemic—have an effect on foreign policy. But it does not follow that they all fall into some sweeping “foreign affairs” exception to major questions.

The three liberal justices—Elena Kagan, Sonia Sotomayor, and Ketanji Brown Jackson—did not rule on the major-questions issue, because, as Kagan noted in a concurring opinion, they believe that “ordinary tools of statutory interpretation” are enough to invalidate the IEEPA tariffs. Like Roberts, they found that the sweeping nature of the power claimed by Trump helps doom his position. As Kagan puts it, “What Congress has never done in a tariff provision is what the Government claims it did here—conferred power on the President to impose a tariff of any amount, for any time, on only his own say-so.”

Underpinning the major-questions issue is that of “nondelegation”: constitutional constraints on the extent to which Congress can delegate legislative authority to the executive. The Court did not address this issue, because it did not need to in order to resolve the case. But Gorsuch, in his concurring opinion, made a strong argument that the president’s claim to almost unlimited tariff authority would violate nondelegation. If there are any meaningful limits to delegation at all, a grant of unconstrained power to impose tariffs would violate them.

The three dissenting justices, in different ways, argue for a sweeping exemption for tariffs from both the major-questions doctrine and nondelegation. Thomas’s solo dissent is particularly expansive, arguing that nondelegation only really applies to “rules setting the conditions for deprivations of life, liberty, or property.” Such a position would run roughshod over the text and original meaning of the Constitution, and create a dangerous form of near-monarchical presidential power.

In addition to upholding the separation of powers, the decision is a victory for the rule of law, which requires that major legal rules be clearly established by legislation, not subject to the whims of one person. Since first imposing the Liberation Day tariffs, Trump has repeatedly suspended and reimposed various elements of them. He has also imposed or threatened to impose IEEPA tariffs for a variety of other purposes, such as countering the supposed threat of foreign-made movies, punishing Brazil for prosecuting its former president for attempting to launch a coup to stay in power after losing an election, and most recently castigating eight European nations opposed to his plan to seize Greenland. Such gyrations undermine the stable legal environment essential for businesses, consumers, and investors, and create endless opportunities to reward cronies and punish political adversaries. Studies show that firms contributing to the Republican Party were disproportionately likely to receive exemptions from tariffs imposed during Trump’s first term, while firms contributing to Democrats were more likely to have to pay. If allowed to stand, the IEEPA tariffs would have created much greater opportunities for such corruption.

The more direct consequences of letting the tariffs stand would have been devastating, too. The Tax Foundation estimates that these tariffs would have added an average of some $1,000 a year in taxes per household (the biggest tax increase in decades), reduced GDP by about 0.4 percent a year, diminished real wages, and imposed additional harm in the form of higher prices throughout the economy. Both a recent Kiel Institute for the World Economy study and one conducted by the Federal Reserve Bank of New York find that 90 percent or more of the cost of the tariffs would have been borne by American businesses and consumers, not foreign producers. Multiple other studies reach similar conclusions. The taxes are regressive and would disproportionately harm the poor and lower-middle class, because these groups spend a higher percentage of their income on goods subject to tariffs. The actual effects might have been even larger than economists’ estimates, as the estimates do not fully consider the effects of retaliation by trading partners and reduction in consumer choice. In combination, it was the biggest tax increase in decades, and would have led to the biggest trade war since the notorious Smoot-Hawley tariff, which gravely deepened the Great Depression.

David Frum: The Supreme Court delivers Trump a humiliating gift

Some of the damage has already been incurred: U.S. businesses had paid more than $133.5 billion toward these illegal tariffs as of mid-December. They may face a difficult process for reclaiming their funds. But the Trump administration promised to repay them in lower-court filings, and failing to do so now would in itself be a serious violation of the law.

The administration may try to reimpose many of the tariffs using other statutes, such as Section 232 and Section 301. But those laws have various constraints that would make it hard for the president to simply impose unlimited tariffs, as he could have done under his interpretation of IEEPA. As Chief Justice Roberts noted in his opinion yesterday, “When Congress has delegated its tariff powers, it has done so in explicit terms, and subject to strict limits,” and these others statutes all have limitations on the amount and duration of the tariffs they authorize, plus “demanding procedural prerequisites.” If Trump or a future president does claim that those other statutes give him unlimited power, tariffs imposed based on any such theory would themselves be subject to legal challenges. Yesterday’s decision signals that a majority of the Court is seriously skeptical of claims of sweeping executive tariff authority.

Following the release of the Court’s decision, Trump announced his intention to use Section 122 of the Trade Act of 1974 to impose 10 percent global tariffs. But Section 122 authorizes tariffs only in response to “fundamental international payments problems” that cause “large and serious United States balance-of-payments deficits” (which are not the same as trade deficits used to justify the IEEPA Liberation Day tariffs), or “an imminent or significant depreciation of the dollar,” or if they are needed to cooperate with other countries in addressing an “international balance-of-payments disequilibrium.” And Section 122 tariffs can remain in force for only up to 150 days, unless extended by Congress.

The president is not a king, and is not entitled to practically unlimited power to impose tariffs. The Supreme Court was right to deny it to him.