Trump Tariffs Blocked by US Court: Abuse of Power Declared Unconstitutional
On May 29, the US Federal Court of International Trade declared former President Donald Trump's tariff policy unconstitutional and blocked its implementation. The court found that Trump abused his executive powers and acted beyond the limits of the Constitution by imposing broad tariffs without sufficient justification.
Court’s Key Observations:
- The three-judge panel ruled that Trump misused the International Emergency Economic Powers Act (IEEPA), which only grants special powers in genuine emergencies.
- The long-standing trade deficit, cited by Trump as justification, does not constitute a sudden emergency.
- The Constitution gives Congress the authority to regulate foreign trade, not the President.
- Unilateral actions under the guise of emergency are not acceptable.
Timeline for Impact:
According to Bloomberg, the ruling may take 10 days to implement, during which the Trump administration must take necessary administrative actions.
What if the Ruling Stands?
- Tariffs may be removed: 30% on China, 26% on India, 25% on Canada and Mexico, and 10% on other nations.
- In April, the US earned a record $16.5 billion from tariffs. If overturned, this revenue stream would end.
Trump’s Remaining Powers:
Trump still retains limited authority under the 1974 Trade Act, allowing up to 15% tariffs for a maximum of 150 days, but even this requires substantial justification.
Legal Basis of the Verdict:
- The Liberty Justice Center filed a lawsuit on behalf of 5 small American businesses hurt by the tariffs.
- 12 American importers also petitioned the court, citing increased costs and economic hardship.
The court accepted their arguments, stating that the President does not have constitutional authority to impose such broad tariffs without Congressional approval.
Trump’s Response:
Trump announced plans to immediately appeal the ruling. On his social media platform, he defended the tariffs as necessary to "Make America Great Again." He also cited the April 2, 2025 'Liberation Day' declaration, where tariffs were imposed on goods from over 100 countries.
Future Outlook:
- Appeal Pending: The final decision depends on the outcome of the Trump administration's appeal.
- 90-Day Relief: Some tariffs were already paused for 90 days to allow for trade negotiations.
- Global Impact: The World Trade Organization (WTO) warned that Trump's tariffs could cause an 81% drop in global trade. The court's decision could mitigate that risk.
China Exception:
China was excluded from the initial 90-day tariff relief due to retaliatory tariffs. At one point, US tariffs on Chinese imports had reached 145%, which were later reduced after negotiations.