A federal court dealt another blow to President Donald Trump’s trade agenda, ruling against a 10% global tariff the president imposed this year to replace tariffs struck down by the Supreme Court.
A panel of judges for the Court of International Trade ruled 2-1 that Trump couldn’t use the 1974 Trade Act to impose the 10% levy. The court only blocked the tariffs on two businesses and Washington state, which brought the lawsuit, but the decision could prompt more legal challenges.
The Trade Act allows temporary tariffs for up to 150 days to address significant “balance of payments deficits,” but the court ruled that the law wasn’t appropriate for the kinds of trade deficits cited in Trump’s February order.
The Supreme Court Backdrop
The ruling comes after the Supreme Court overturned a pillar of Trump’s second-term agenda. It declared his use of emergency powers to enact tariffs was unconstitutional. Trump had cited the 1977 International Emergency Economic Powers Act to enact sweeping levies in a bid to reorder trading relationships with countries around the globe.
Tariffs have been central to Trump’s economic policy, with the president wielding the levies as a weapon to push for new trade deals. He lashed out at the Supreme Court after its Feb. 20 order against his emergency tariffs, calling the ruling “deeply disappointing.”
“I’m ashamed of certain members of the court – absolutely ashamed – for not having the courage to do what’s right for our country,” Trump said.
What the 10% Tariff Covers — and What It Doesn’t
The two small businesses that brought the latest challenge, a toy company and spice importer, argued the 10% global levy was an effort to get around the Supreme Court decision. The White House did not immediately respond to a request for comment on the court ruling.
Trump announced the 10% tariff on the same day the Supreme Court ruled against his other tariff program. It applied to most imports, although Trump exempted certain products such as beef, tomatoes, oranges, pharmaceuticals, passenger vehicles, and some critical minerals. Products governed by a trade deal with Canada and Mexico also were excluded.
The court rejected a request from a group of 24 states to block the 10% tariff for all importers. The court ruled that most of the states, with the exception of Washington, were not importers who had paid or could have paid the tariffs.
Contributing: Bart Jansen, Reuters
