The court says no: the Supreme Court’s rebuke of Trump’s tariff gambit

ON FEB 20, 2026, the US Supreme Court delivered one of the most consequential rulings of the Trump era, and perhaps one of the most significant check on executive power in a generation.

In a 6-3 decision authored by Chief Justice John Roberts, the court struck down the sweeping tariffs US President Donald Trump imposed on imports from nearly every country in the world, holding that the 1977 law he used to justify them granted no such authority. The ruling was blunt, the majority’s logic airtight, and the political fallout immediate and volcanic.

To understand the stakes, one must first understand the president’s claim. Relying on the International Emergency Economic Powers Act (IEEPA) – a 1977 statute designed to regulate commerce in response to foreign emergencies – Trump imposed “reciprocal” tariffs including duties as high as 145 per cent on Chinese goods and a baseline 10 per cent on nearly all other trading partners.

He justified this by declaring trade deficits an “unusual and extraordinary threat” to national security. The administration argued that the word “regulate” in IEEPA was broad enough to encompass the power to tax imports.

The court was having none of it. Chief Justice Roberts noted that while IEEPA authorises the president to investigate, block, regulate, direct and compel, nullify, prevent or prohibit, this list of verbs does not include the power to tax. Crucially, the word “tariff” does not appear anywhere in IEEPA, nor does “duty”.

“Major questions doctrine”

He invoked the “major questions doctrine” – the principle that when an executive action involves an issue of vast economic significance, the president must point to clear congressional authorisation.

The majority found the statutory silence decisive. Chief Justice Roberts wrote that “when Congress grants the power to impose tariffs, it does so clearly and with careful constraints”, and that Congress did neither here.

This consistency gives the decision its bite. For years – including during the Biden administration – the court has insisted that major policy questions require legislative clarity, not creative statutory interpretation by executive branch lawyers.

By applying this logic to a president of their own party, the court demonstrated a notable independence. Two of Trump’s own nominees, Justices Neil Gorsuch and Amy Coney Barrett, joined the majority (three liberal justices and Chief Justice Roberts), signalling that the separation of powers remains a constitutional commitment rather than a partisan one.

The dissenters, Justices Clarence Thomas, Samuel Alito and Brett Kavanaugh, offered a different view. Justice Kavanaugh’s dissent acknowledged the practical chaos ahead, warning that the refund process “is likely to be a ‘mess’”.

Indeed, the court left open how the government should return the tariff revenue collected. Penn-Wharton Budget Model economists estimate the refund amount at about US$175 billion. Untangling who owes what to whom will be a logistical nightmare as some of that money has already been passed through to consumers.

The economic picture adds urgency to this drama. A working paper from Harvard University professor and former International Monetary Fund economist Gita Gopinath estimates that nearly all the cost of Trump’s tariffs were being paid by US importers, not foreign suppliers.

Consequently, American businesses and consumers absorbed the costs. Factories shed 108,000 jobs in 2025, with managers consistently citing tariffs as a drag on operations. The tariffs generated revenue, but at enormous cost to the very people they were ostensibly designed to protect.

Trump’s response was characteristically defiant. He called the decision “deeply disappointing” and “unpatriotic”, reserving particular venom for Gorsuch and Barrett, whose decision he called “an embarrassment to their families”.

The conflict escalated quickly: Invoking a different law – Section 122 of the Trade Act of 1974 – the White House ordered a new 10 per cent global tariff. The next day, Trump raised the tariff to 15 per cent. While the court closed one door, the president was already shopping for a new key.

This last point deserves sober reflection. The ruling is a victory for the rule of law, but it is not the end of the trade war. The court struck down IEEPA tariffs but left untouched Section 232 tariffs on steel, aluminium and automobiles. These remaining levies are estimated to raise US$635 billion over the next decade, amounting to an average tax increase of US$400 per US household in 2026.

Constitutional statement

The founders designed a system in which Congress holds the power of the purse and the authority to regulate commerce. While presidents have steadily accumulated trade powers over decades, this ruling establishes limits.

A president cannot simply declare a trade deficit a national emergency to impose the most sweeping tariff regime since the Great Depression. The Supreme Court, a body Trump spent years reshaping, looked at his most ambitious domestic policy and said, simply, “no”.

That two of his own appointees joined that judgment makes it not just a legal ruling but a constitutional statement – one that will echo long after this administration ends.

Congress makes tax law. Congress regulates trade. The executive executes. When those lines are crossed, the courts remain the last resort. On Feb 20, 2026, they proved they still mean it.