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| President Trump holding a tariff report. Photo: Chip Somodevilla/Getty Images |
Most of Trump’s Global
Tariffs Ruled Illegal, But For Now They Still Stand
U.S. Appeals Court Rules
Most of Trump’s Global Tariffs Illegal Under IEEPA.
A federal appeals court
finds most of Trump’s sweeping 2025 global tariffs illegal under the
International Emergency Economic Powers Act, but stays enforcement pending
appeal.
A federal appeals court has
delivered a significant legal blow to President Trump’s sweeping global tariff
strategy, finding that most of the 2025 tariffs—imposed under the International Emergency Economic Powers Act (IEEPA)—were
unconstitutional. In a 7–4 decision, judges held that Trump's justification did
not meet the legal definition of a national emergency, making the tariffs
exceed the scope of presidential authority.
Crucially, the court did
not outlaw all possible tariffs under IEEPA, just that the “Liberation Day”, reciprocal, and other
global tariffs lacked the required legal grounding. While the tariffs remain in
place temporarily, the ruling sets the clock ticking: they are scheduled to
expire on October 14 unless the administration successfully appeals.
President Trump was swift
in his response, blasting the ruling on social media as "partisan"
and warning it could “literally destroy the United States of America” if
upheld. The White House and Trump vowed to appeal, aiming to escalate the issue
to the Supreme Court.
What It
Means for Markets and U.S. Trade
The ruling reverberated
across industries and markets. U.S. retail
giants like Walmart and Nike could benefit from lower costs if
tariffs are struck down, while sectors like automotive—less affected by global tariffs—see limited
relief. Analysts caution that the decision could unsettle businesses navigating
fluctuating trade policies.
Looking ahead, the Trump
administration might lean on alternative legal frameworks—such as Section 232 (national security-related tariffs)
or Section 301 (retaliation
for trade violations)—to support future tariffs without relying on IEEPA.
Legal
Journey Continues
The tariffs themselves
remain active during the legal limbo. The court's stay ensures they stay
enforced through mid-October, buying time for the administration to mount a
challenge in the Supreme Court. Currently, the judicial system is intensively
reviewing whether emergency powers can ever justify sweeping trade
measures.
If the Supreme Court takes
up the case, it will become one of the most consequential legal questions about
executive power and trade policy in recent memory. The optics and stakes are high
as the fate of U.S. tariffs—and potentially billions in revenue—hangs in the
balance.