Big news from the courts! A federal appeals panel just dropped a bombshell, ruling that most of Trump’s signature tariffs are actually illegal. This isn’t just about trade; it’s a huge challenge to presidential power. The administration plans to fight this all the way to the Supreme Court. What could this mean for the future of US trade policy?

A significant federal appeals court decision has declared the majority of the Trump administration’s imposed tariffs illegal, delivering a substantial setback to the former Republican president’s extensive economic agenda and paving the way for a definitive showdown at the Supreme Court.

Despite the ruling, the court has permitted these contentious tariffs to remain in effect until October 14, granting the Trump administration a critical window to lodge an appeal with the Supreme Court, where a 6-3 conservative majority is anticipated to wield considerable influence over the final outcome of the highly scrutinized tariff regime.

Donald Trump prominently championed the use of tariffs as a cornerstone of his economic strategy, implementing steep taxes on various imports with the stated goal of revitalizing domestic manufacturing across the United States. His administration, citing a national emergency over the U.S. trade deficit, invoked the 1977 International Emergency Economic Powers Act (IEEPA) to unilaterally impose reciprocal tariffs on goods from numerous nations, a move now under intense judicial scrutiny.

However, the federal appeals court concluded that the former president had exceeded his statutory authority in applying the IEEPA for these specific import tariffs. The majority opinion, delivered by seven judges, stated, “It seems unlikely that Congress intended, in enacting IEEPA, to depart from its past practice and grant the President unlimited authority to impose tariffs,” emphasizing the statute’s lack of explicit mention of “tariffs” or similar terms.

Reacting swiftly to the verdict, Trump vehemently criticized the decision, characterizing it as the product of a “Highly Partisan Appeals Court” but expressed unwavering confidence that the Supreme Court would ultimately side with his administration. He warned that the removal of these vital import tariffs would be a “total disaster for the Country,” asserting they are crucial for national financial strength.

The court’s decision highlighted that the IEEPA statute notably omits terms like “tariff,” “duty,” or “tax” when outlining the president’s powers during an emergency, contrasting sharply with other federal laws that explicitly grant tariff-imposing authority. While the administration argued the IEEPA’s power to “regulate” imports in a crisis, such as the trade deficit and fentanyl flow, covers tariffs, the court disagreed.

It is crucial to note that this ruling specifically pertains to tariffs enacted under the IEEPA and does not affect other tariffs issued under different legal frameworks, such as the Trump administration’s previously implemented tariffs on steel and aluminum imports, which operate under separate statutory authorizations.

The federal appeals court’s decision consolidated two key challenges: one initiated by five small U.S. businesses and another by twelve Democratic-led U.S. states. Both legal actions contended that the IEEPA does not grant the president the authority to impose tariffs, arguing further that the nation’s trade deficit does not qualify as an “emergency” or an “unusual or extraordinary” threat justifying such executive action.

This current ruling follows a previous victory for the states and businesses in the U.S. Court of International Trade, which the Trump administration subsequently appealed. Furthermore, a separate federal appeals court is independently reviewing another judge’s ruling regarding the president’s tariff powers in a distinct challenge brought by two Illinois toy importers, indicating a complex and multi-front legal battle over presidential trade authority.