A US appeals court has ruled that most tariffs imposed by Donald Trump were unlawful. The decision delivers a sharp setback to his trade agenda and sets up a likely Supreme Court confrontation.
The judgement invalidates Trump’s “reciprocal” tariffs targeting dozens of countries. It also blocks levies against major partners such as China, Mexico and Canada.
Judges deny Trump tariff powers
In a 7-4 ruling, the US Court of Appeals for the Federal Circuit declared the tariffs “invalid as contrary to law”.
The judges rejected Trump’s reliance on the International Emergency Economic Powers Act. They stated that the authority to impose tariffs belongs exclusively to Congress.
The decision will take effect on 14 October unless the Supreme Court agrees to hear the case.
Trump reacts with fury
Trump denounced the ruling on Truth Social. He warned that removing the tariffs would “literally destroy the United States”.
He accused the appeals court of political bias and insisted America would prevail. Trump argued the tariffs were essential to maintain financial and national strength.
Court dismisses emergency claim
Trump had justified his actions under the IEEPA. He declared a trade emergency, arguing that deficits posed a national security risk.
The judges disagreed. Their 127-page opinion stated that the law “neither mentions tariffs nor limits presidential authority in this way”.
They stressed that Congress has always retained tariff powers and delegates them only through explicit legislation.
States and businesses drove lawsuits
Two lawsuits sparked the case. Small businesses and a coalition of states challenged Trump’s April executive orders.
The orders imposed a 10% tariff on nearly every nation. They also established “reciprocal” tariffs on dozens of others. Trump described the day as America’s “liberation” from unfair trade practices.
Earlier this year, the Court of International Trade had already ruled against the tariffs. That decision was paused during the appeal.
Canada, Mexico and China tariffs struck down
The appeals court ruling also nullifies tariffs on Canada, Mexico and China. Trump had argued they were needed to combat drug imports.
However, tariffs on steel and aluminium remain untouched, as they were introduced under separate presidential authority.
White House warns of financial chaos
White House lawyers issued stark warnings before the ruling. They claimed that overturning the tariffs could spark a collapse like the Great Depression of 1929.
They said the US might fail to repay trillions already pledged by foreign partners. Such an outcome, they argued, could cripple the economy and weaken national security.
The ruling also raises doubts about agreements some countries reached for lower tariff rates with Washington.
Supreme Court prepares to weigh in
The dispute is now expected to head to the Supreme Court. The justices have recently limited presidential actions not clearly backed by Congress.
During Joe Biden’s presidency, the court struck down climate measures and cancelled student debt relief. Both were overturned under the “major questions doctrine”.
The justices must now decide whether Trump’s tariff programme represents executive overreach or a legitimate use of authority.
Conservative bench could influence ruling
Trump’s loss came in a court where only three of eleven judges were Republican appointees.
The Supreme Court presents a different picture. Six of its nine justices are conservatives, including three nominated by Trump.
This balance could shape the outcome of a case that may redefine presidential powers over trade for years to come.
