- Supreme Court strikes down Trump’s tariffs under emergency powers law.
- Ruling limits administration’s ability to maintain IEEPA-based tariffs.
- U.S. and India defer this week’s trade talks to assess impact.
THE SUPREME COURT on Friday struck down President Donald Trump’s global tariffs under the 1977 International Emergency Economic Powers Act, ruling he exceeded his authority. Trump used IEEPA to impose tariffs on most U.S. trading partners without congressional approval.
In a 6 to 3 ruling, the Supreme Court upheld a lower court decision against Trump after challenges from businesses and 12 states, according to Reuters. The court said imposing tariffs under IEEPA exceeded presidential authority, noting the Constitution gives Congress, not the president, the power to levy taxes and tariffs.
The administration projected IEEPA-based tariffs would generate over $175 billion, with total tariffs potentially reaching $300 billion annually over the next decade if maintained. U.S. Treasury data show net customs duties reached $195 billion in fiscal 2025. Trump’s tariffs prompted trade concessions and investment pledges but also strained relations with allies.
The ruling limits the administration’s ability to maintain tariffs under IEEPA. Officials said other legal avenues might be used, including statutes for national security or retaliatory tariffs, but these cannot match IEEPA’s speed or scope. Trump said the tariffs were key to U.S. trade leverage and indicated new plans could follow if the Court ruled against him.
The ruling affected India-U.S. trade talks, BBC reported. An Indian delegation was set to visit Washington to finalize an interim agreement that cut U.S. tariffs on Indian goods from 50 percent to 18 percent. The agreement included reciprocal commitments from India to lower tariffs on U.S. industrial, food and agricultural products. However, several issues remained unresolved, including India’s potential $500 billion purchases of U.S. goods over five years, Russian oil imports and the balance of concessions.
Indian exporters faced 50 percent tariffs from Trump starting Aug. 27, including penalties for Russian oil purchases. The interim trade deal provided partial relief but left questions on terms and domestic protections.
India’s plan to buy $500 billion of U.S. goods over five years could distort procurement and affect its trade balance. Experts question whether $100 billion a year in imports is feasible without policies directing companies to U.S. suppliers.
After the Supreme Court ruling and Trump’s announcement of 15 percent global tariffs under a rarely used law, India and the U.S. deferred the scheduled talks. According to the BBC, both sides will review the ruling and potential changes in U.S. trade policy before setting a new date for the delegation’s visit, adding uncertainty to the interim trade deal and highlighting its broader impact on U.S. trade policy and international negotiations.
