Supreme Court Blocks Trump Tariffs in 6–3 Shock Ruling

What Happened

In Learning Resources, Inc. v. Trump, the Supreme Court of the United States ruled that President Donald Trump lacked authority to impose broad tariffs under the International Emergency Economic Powers Act.

The tariffs included a baseline 10% “reciprocal” levy on imports from nearly all countries and higher duties targeting major partners. The administration justified the measures through declared emergencies tied to trade deficits and drug trafficking flows.

Chief Justice John Roberts wrote the majority opinion, stating that the Constitution grants Congress exclusive authority to impose tariffs. The Court found that IEEPA does not explicitly authorize taxation or duties and failed the “major questions” threshold for actions of large economic consequence.

Within hours of the ruling, Trump announced he would issue a new executive order under Section 122 of the Trade Act of 1974. That provision allows temporary surcharges of up to 15% for 150 days to address balance-of-payments concerns.

Source : Truth Social

Why This Matters

The ruling reasserts congressional control over tariff authority. It narrows the executive branch’s ability to use emergency powers for large-scale trade actions.

For markets, the immediate effect reduces uncertainty tied to indefinite Trump ‘s emergency tariffs. However, Trump’s rapid pivot signals continued volatility in trade policy.

For businesses, the decision opens questions about refunds for more than $130 billion in collected duties. Lower courts will now handle potential reimbursement claims, which could take years.

At a constitutional level, the ruling reinforces separation of powers. The majority opinion emphasized that large economic actions require clear congressional authorization.

What’s the Buzz around tariffs?

The invalidated tariffs generated significant revenue and influenced negotiations with major trading partners. They targeted imports from China, Canada, Mexico, the European Union, Japan, and South Korea.

The decision leaves intact other tariff programs imposed under separate legal authorities, including Section 232 national security measures and Section 301 China-specific actions.

Markets responded with modest gains following the announcement, reflecting relief over reduced executive unpredictability. Still, the administration’s move to invoke Section 122 suggests the trade debate remains active.

The ruling may shape future disputes over presidential authority in economic policy, especially as election cycles heighten political sensitivity around trade.

What readers should watch next?

The immediate trigger is the expected executive order activating the new Section 122 tariffs, likely within days, which will formally start the 150-day clock running into roughly July 2026. Markets will also focus on the lower-court remedy phase, where refund litigation hearings expected in March–April could reshape business and liquidity expectations. Retaliatory responses from China or the EU would introduce fresh macro pressure, while any expansion under Section 232 national-security authorities would deepen risk sentiment.

On the political front, a summer push in Congress to codify permanent tariff legislation could either entrench trade friction or curb executive authority. If alternative statutes withstand court scrutiny, bearish pressure on global risk assets, including crypto, could intensify. Conversely, if Congress moves to limit Trump tariffs, it would mark a structural bullish reset for broader markets.