In a major constitutional and economic ruling, the Supreme Court of the United States has struck down President Donald Trump’s global tariffs, finding that he exceeded presidential authority under emergency powers law.

Within hours of the decision, Trump responded by announcing a new 10% global tariff under a separate statute — setting up a renewed battle over executive power, congressional authority, and the future of U.S. trade policy.

This development is poised to reshape international trade negotiations, impact North American supply chains, and intensify debate over presidential tariff authority in 2026.

The case centered on Trump’s use of the International Emergency Economic Powers Act (IEEPA), a 1977 law that allows presidents to regulate certain economic transactions during a declared national emergency.

Writing for the majority, Chief Justice John Roberts concluded that the statute does not authorize the president to impose tariffs. The court emphasized that the U.S. Constitution grants Congress exclusive authority over taxation and duties on imports.

Two conservative justices appointed during Trump’s first term — Amy Coney Barrett and Neil Gorsuch — joined the majority, alongside the court’s liberal justices.

Justice Brett Kavanaugh dissented, raising concerns about the practical consequences of the ruling, including the potential complexity of refunding billions in previously collected tariffs.

The decision reinforces a longstanding principle of U.S. constitutional law: Congress holds the power to levy taxes and tariffs. While presidents may regulate trade under certain statutes, the court determined that IEEPA does not extend to broad, economy-wide tariffs.

Legal analysts describe the ruling as a significant limitation on executive trade authority and a rare rebuke of presidential power expansion.

In a White House press conference, Trump criticized the court’s ruling and announced he would impose a 10% global tariff effective immediately under Section 122 of the Trade Act of 1974.

Section 122 allows the president to implement temporary tariffs of up to 15% for 150 days without congressional approval to address trade deficits. After that period, Congress must authorize any extension.

Trump also signaled additional investigations under Section 301 of the Trade Act and continued reliance on Section 232 tariffs affecting steel, aluminum, autos, and lumber.

This shift suggests a recalibration of strategy rather than a retreat from aggressive trade enforcement.

Business coalitions that challenged the tariffs estimate that presidential trade measures generated approximately $175 billion in revenue between March and October of last year.

The Supreme Court did not address whether American importers will receive refunds for tariffs collected under IEEPA authority. That issue may now be resolved through additional litigation.

Key questions include:

Financial markets are closely watching for clarity as uncertainty lingers.

The ruling carries significant implications for Canada-U.S. trade relations and the upcoming CUSMA review.

Ontario Premier Doug Ford called the decision an important step but noted that tariffs on steel, aluminum, autos, and forestry products remain in place.

Conservative Leader Pierre Poilievre described the ruling as progress while urging full elimination of sector-specific tariffs during negotiations.

Canada-U.S. Trade Minister Dominic LeBlanc stated that the ruling reinforces Canada’s position that the IEEPA tariffs were unjustified.

Industry leaders, including Flavio Volpe of the Automotive Parts Manufacturers’ Association, cautioned that national security tariffs under Section 232 remain a serious challenge for the auto sector.

Beyond its immediate economic effects, the ruling represents a defining moment in the balance of power between the executive and legislative branches.

Justice Gorsuch emphasized in a concurring opinion that major economic decisions affecting American taxpayers should flow through Congress, even when legislative processes are slower and politically difficult.

The decision may limit future presidents from using emergency powers statutes to impose broad trade restrictions without congressional approval.

Several developments are expected in the coming weeks:

While the Supreme Court has narrowed one path for executive tariff authority, the broader trade policy conflict remains active.