20 February 2026 will be remembered by US President Donald Trump as a very bad day. It is the day the Supreme Court delivered its long-awaited ruling on the legality of the tariffs imposed during his second term. Although a majority of the justices are regarded as politically close to the president, six out of nine found the core of the tariff regime unlawful, stating that the law invoked by Trump to introduce them – the International Emergency Power Act of 1977 (IEEPA) – does not authorise the president to impose generalised tariffs without time limits.
The justices therefore confirmed that the power to levy tariffs rests with Congress. In particular, the Supreme Court annulled the global minimum 10% tariffs on most imports, the country-specific reciprocal tariffs and the additional 25% duties on certain goods from China, Mexico and Canada, justified as a response to fentanyl trafficking. The tariffs on steel and aluminium, however, remain in force, as they were introduced under different legislation, namely the Trade Expansion Act.
In its ruling, the Court referred to the principle that the power to impose tariffs is a matter of taxation and foreign commerce for Congress, not the president, except where specific and limited delegations apply. In particular, the IEEPA refers to regulating imports and exports in cases of “unusual and extraordinary threats”, but makes no mention of tariffs; using this statute to introduce a global minimum tariff was deemed a distortion of the text. The justices’ reasoning also drew on the “major questions doctrine” and the doctrine of “non-delegation”: for decisions with an enormous economic impact, involving trillions of dollars in trade and hundreds of billions in revenue, clear authorisation from Congress is required, not an expansive interpretation of an emergency law. The Court reiterated that if Congress genuinely intends to grant the president such broad tariff powers, it must state so explicitly in the legislation; a generic formula is not sufficient.
The economic consequences of the ruling could be significant for the administration. The Congressional Budget Office estimated the economic impact of these tariffs at around 3 trillion dollars over the next decade, and the Treasury has already collected more than 130 billion dollars from the measures, which may now be subject to refund claims from importers. Lawsuits seeking repayment of the duties are already under way, particularly from importers and major retailers, and the judgment strengthens their position.
