A federal appeals court has delivered a sharp blow to Donald Trump’s signature trade weapon, ruling that most of his tariffs don’t hold up under the law.
In a 7–4 split, the judges declared that Trump’s use of emergency powers to slap levies on imports strayed beyond what Congress ever authorized. Yet, the ruling won’t bite immediately—the court has kept the tariffs alive until mid-October to give the White House time to take the fight to the Supreme Court.
Trump, who has built much of his second-term economic policy on tariffs, was quick to denounce the ruling as the work of a “highly partisan” bench. He insisted the measures were essential to protect American industry and vowed the nation would be vindicated once the case reached the justices.
The appeals panel focused on Trump’s so-called “reciprocal” tariffs launched in April as part of his ongoing trade war, and another set targeting China, Canada, and Mexico in February. Both rounds were justified under the International Emergency Economic Powers Act (IEEPA), a 1977 law traditionally used for sanctions and asset freezes—not tariffs.
The court pushed back hard: Congress, it said, never meant for IEEPA to hand presidents “unlimited authority to impose tariffs.” The Constitution, after all, places that power squarely in the hands of lawmakers.
Trump has argued otherwise, declaring a “national emergency” over decades of trade deficits and accusing key partners of failing to stop fentanyl from crossing U.S. borders. His Justice Department insisted that emergency powers extend to blocking or regulating imports entirely—tariffs included.
The ruling has fueled more uncertainty for markets already jittery over trade. Analysts say the administration has been preparing a fallback plan, possibly by turning to other statutes to justify keeping the tariffs in place.
At the same time, Trump is engaged in another legal standoff over the Federal Reserve’s independence, raising the stakes for a Supreme Court term that could reshape the boundaries of presidential power.
Challenges to Trump’s tariff strategy have multiplied—filed by small businesses, Democratic-led states, and even California directly. Earlier this year, a New York trade court also found the tariffs unlawful, with one Trump-appointed judge joining that rebuke.
With the Supreme Court holding a conservative majority that has both bolstered and constrained Trump in past rulings, the coming battle could decide not just the fate of tariffs but the limits of presidential authority itself.
