In a political setback for President Donald Trump, the US Supreme Court has struck down most of his tariffs put in place over the last 13 months, ruling they are unconstitutional. In a 6-3 decision the court found the president exceeded his authority by using the International Emergency Economic Powers Act (IEEPA) of 1977 to implement many of the tariffs.
The administration had prepared alternatives. In response to the ruling, Trump said he would impose a 10% global tariff for 150 days to replace some of the duties that were struck down. The new tariffs would be implemented under Section 122 of the Trade Act of 1974, which allows the president to impose duties of up to 15% for up to 150 days on countries tied to “large and serious” balance of payments issues. Unlike other options, Section 122 does not require investigations or procedural limits, but if tariffs continued beyond 150 days they would need congressional approval.
“We have alternatives, great alternatives,” Trump told reporters. “Could be more money. We’ll take in more money, and we’ll be a lot stronger for it.”
Legal experts note other statutes the president could use, though they are slower or require justification. Section 301 of the Trade Act of 1974 permits tariffs on countries that violate international trade agreements harming US businesses; there is no cap on amount or duration but tariffs must be justified by investigations that can take months. Trump said his administration was initiating several Section 301 unfair trade practices investigations.
Section 232 of the Trade Expansion Act of 1962 allows tariffs on national security grounds for specific sectors such as steel, aluminum or lumber, following an investigation by the Department of Commerce. The president has used Section 232 before. US Secretary of the Treasury Scott Bessent said the “treasury’s estimates show that the use of Section 122 authority, combined with potentially enhanced Section 232 and Section 301 tariffs will result in virtually unchanged tariff revenue in 2026.”
The Supreme Court’s ruling could also mean refunds for affected US importers. For 2025, US Customs and Border Protection collected $287 billion in customs duties, taxes and fees—an increase of 192% compared to the previous year, according to calculations by the Federal Reserve Bank of Richmond. That total includes duties already in place when Trump took office as well as the more recent “reciprocal” tariffs.
Importers who paid the struck-down tariffs will seek refunds, a welcome relief for businesses but complicated in practice. Refunds would go to importers who paid the duties, not to consumers, and processing returns would be a major administrative challenge for the government, which could also face billions in lost revenue. Trump said resolving whether collected tariffs must be refunded “may take years” and predicted extended litigation: “We’ll end up being in court for the next five years.”
This dispute reached the Supreme Court after hundreds of lawsuits filed by businesses and others sought to stop the tariffs. Over the past 13 months, Trump imposed tariffs by decree on many countries, sometimes pausing them or negotiating lower rates, citing trade imbalances and drug smuggling. Critics say many tariffs have little to do with trade deficits and more to do with pressuring other countries.
The court’s decision was less about tariffs per se and more about the constitutional limits on presidential power.
Edited by: Ashutosh Pandey
