When US trade court says no: The limits of presidential tariff authority

FOR the second time this year, a federal court has told the Trump administration that it cannot tariff its way around the Constitution. On Thursday (May 7), a three-judge panel of the US Court of International Trade ruled 2-1 that the 10 per cent across-the-board duty the president imposed in February was unauthorised by law.

The decision is narrow in its immediate reach since only the small-business plaintiffs who sued are entitled to refunds and exemptions, but its implications are anything but.

To understand why, it helps to retrace the steps that brought us here. In February, the Supreme Court struck down the broader tariff regime US President Donald Trump had built on the International Emergency Economic Powers Act (IEEPA), holding that the Act simply does not authorise tariffs at all.