The US Supreme Court has begun negotiations over US President Donald Trump’s tariff policy. Several Supreme Court judges expressed doubts on Wednesday as to whether Trump was allowed to use an emergency law to impose far-reaching import surcharges on trading partners worldwide. Lower courts had declared Trump’s actions illegal.
A majority of the nine Supreme Court justices questioned the tariffs at oral hearings. Chief Justice John Roberts, one of six conservatives on the court, pointed to the language of the 1977 Emergency Situations Act (IEEPA) that Trump is relying on. “The law does not contain the word ‘tariffs,'” Roberts emphasized.
Liberal Justice Sonia Sotomayor disputed the government’s statements about the effect of tariffs on US companies and citizens: “You want to say tariffs are not taxes, but that’s exactly what they are,” Sotomayor emphasized. Only Congress has the power to decide taxes, not the President. Judge Neil Gorsuch, appointed by Trump, remarked that once Congress gives up extensive powers to the president, he “can never get that power back.”
Trump warns the US Supreme Court
But Trump administration lawyer John Sauer argued that lifting the tariffs would have “catastrophic economic and national security consequences” and expose the U.S. to “merciless trade retaliation” from other countries. Countries like China had imposed countermeasures precisely because of the high US import surcharges.
The tariffs are a central part of Trump’s economic policy under the motto “America first”. He accuses the EU and other trading partners of having “ripped off” the USA for years with their export surpluses.
The President had therefore warned the Supreme Court in advance against a negative decision. If tariffs were eliminated, the United States would become a “third world country,” he claimed. Then billions in revenue would be lost and the domestic industry would be unprotected. Trump originally wanted to take part in the hearing himself, but then decided not to.
Smaller US companies, including a toy retailer and a wine retailer, have sued against the Trump tariffs and are suffering from higher import costs. In addition, twelve US states have gone to court. It will probably be months before a decision is made. The Supreme Court is made up of six conservative and three progressive justices and had previously given Trump preliminary support on a number of issues.
Appeals court declares import duties illegal
On Friday, an appeals court ruled that much of Trump’s import tariffs were illegal. The President is not authorized to impose such far-reaching tariffs, only Congress in Washington is, explained the appeals court in the capital Washington, which is responsible for trade issues, among other things.
The appeals court said the 1977 law sought by Trump gave the US president “broad powers” to respond to a “declared national emergency.” However, these did not expressly contain the authority to “levy customs duties, taxes or the like”.
The issue before the Supreme Court is the punitive tariffs that Trump imposed on numerous countries in several steps from the beginning of April – and which are generally applied to every type of imported goods. A general tariff rate of 15 percent applies to the EU. Higher industry-specific tariffs on aluminum, steel and cars, for example, are not affected.
