US Federal Court Strikes Down Trump’s Global Tariffs; Here’s What Happened

The ruling stems from two combined legal challenges. The nonpartisan Liberty Justice Center filed one case on behalf of small businesses importing goods from tariff-affected countries

On April 2, Trump announced an unprecedented global tariff regime, including a 10 per cent baseline on most imports and steep reciprocal duties

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A US federal court has dealt a significant blow to President Donald Trump’s trade agenda, ruling that the administration lacked authority to impose sweeping global tariffs under an emergency law. The Court of International Trade found that the 1977 International Emergency Economic Powers Act (IEEPA) does not grant the president unilateral power to levy tariffs on nearly all US trading partners.

The New York-based panel emphasised that the Constitution gives Congress exclusive authority over international commerce, which the IEEPA does not override, according to a BBC News report. The Trump administration immediately announced plans to appeal.

Who Filed The Lawsuit?

The ruling stems from two combined legal challenges. The nonpartisan Liberty Justice Center filed one case on behalf of small businesses importing goods from tariff-affected countries. The second was brought by a coalition of US states, led by New York, challenging the legality of the tariffs.

What Did The Court Rule?

The three-judge panel invalidated the global tariffs and blocked separate levies on China, Mexico, and Canada, measures the Trump administration justified as responses to drug trafficking and illegal immigration. However, the court did not review tariffs on specific goods like cars, steel, and aluminum, which were enacted under a different statute, the report added.

What Next?

The administration has 10 days to begin the formal process of suspending the tariffs, though many are already paused. The case will now proceed through the appeals courts, which could reverse the decision.

If the ruling stands, US Customs and Border Protection will issue refund instructions for businesses that paid the tariffs, with interest. Some tariffs, like those on Chinese goods, had risen as high as 145 per cent, now been reduced to 30 per cent.

Trump’s Tariff Attack

On April 2, Trump announced an unprecedented global tariff regime, including a 10 per cent baseline on most imports and steep reciprocal duties on countries like China, Canada, the UK, and the EU.

The stated goal was to bolster US manufacturing and jobs, but the plan caused global market turmoil and led to prolonged trade battles, most notably with China. Tariffs peaked at 145 per cent on Chinese goods, prompting a retaliatory 125 per cent tariff on US exports.

A temporary truce has since reduced US tariffs on China to 30 per cent and Chinese tariffs to 10 per cent. Trump recently threatened a 50 per cent tariff on all EU imports but postponed implementation after EU Commission President Ursula von der Leyen requested more time for negotiations.