The United States Supreme Court declared that the US government exceeded the emergency powers invoked by President Donald Trump to impose a large part of its taxes on the North American country’s trading partners, in a severe setback to the president’s tariff policy.
With a clear majority of 6-3, the Supreme Court dominated by conservatives served the Republican with one of the first major setbacks of his second term, a turn in the trend until now favorable to the president on other key issues on his agenda.
Representing the majority, Chief Justice John Roberts indicated that the Government does not have inherent powers in peacetime to impose tariffs based on the International Economic Emergency Powers Act (IEEPA) of 1977 invoked by Trump as a pillar of his trade war.
In its ruling, the Supreme Court considers that the use of this legislation by Trump would imply an excessively broad delegation of the tax power that the Constitution reserves to Congress, since the High Court considers that tariffs are a type of tax on citizens.
The voices of dissent were those of judges Samuel Alito, Clarence Thomas and Brett Kavanaugh, the most conservative justices of the Supreme Court.
In their opinion, the three judges consider that the president should not be limited in these issues since they consider that the IEEPA can be used in foreign policy issues, which applies in this case.
This decision against Trump’s powers to declare tariffs does not prevent the Republican from imposing taxes under other laws.
Administration officials have already said they hope to maintain the president’s tariff framework with other legal bases, although it is not clear whether those importers who have paid for the high tariffs imposed by the Administration will be able to request and receive refunds, equivalent to several billion dollars.
Trump has insisted that it would be “very disappointing” if the Supreme Court considered illegal the implementation of a large part of the tariffs that, according to him, are the key to the economic success that his Administration is achieving and to put pressure on other nations in terms of foreign policy.
It has also acknowledged that it would be “practically impossible” to return the amounts collected from importers.
Last August, following a lawsuit by two small importing companies, a Federal Circuit appeals court ruled that Trump did not have the right to impose the so-called “reciprocal tariffs,” which range between the 50% paid by Brazil and India and the minimum base of 10% borne by the United Kingdom or most Latin American countries.
The court found that it also did not have the authority to implement the 25% tax imposed on some products from Canada, China and Mexico for what, Washington considers, insufficient efforts to stop the entry of fentanyl into the United States.
However, it avoided freezing the application of tariffs to give the Federal Government time to take the case to the Supreme Court.
