{"id":412,"date":"2025-05-29T14:04:54","date_gmt":"2025-05-29T14:04:54","guid":{"rendered":"http:\/\/www.agencywebdesigners.com\/?p=412"},"modified":"2025-05-29T14:59:11","modified_gmt":"2025-05-29T14:59:11","slug":"what-happens-to-trumps-tariffs-now-that-a-court-has-knocked-them-down","status":"publish","type":"post","link":"http:\/\/www.agencywebdesigners.com\/index.php\/2025\/05\/29\/what-happens-to-trumps-tariffs-now-that-a-court-has-knocked-them-down\/","title":{"rendered":"What happens to Trump\u2019s tariffs now that a court has knocked them down?"},"content":{"rendered":"

By PAUL WISEMAN, Associated Press Economics Writer<\/strong><\/p>\n

WASHINGTON (AP) \u2014 A federal court in New York handed President Donald Trump a big setback Wednesday, blocking his audacious plan<\/a> to impose massive taxes on imports from almost every country in the world.<\/p>\n

A three-judge panel of the U.S. Court of International Trade ruled that Trump overstepped his authority when he invoked the 1977 International Emergency Economic Powers Act to declare a national emergency and justify the sweeping tariffs.<\/p>\n

The tariffs overturned decades of U.S. trade policy, disrupted global commerce, rattled financial markets and raised the risk of higher prices and recession in the United States and around the world.<\/p>\n

The U.S. Court of International Trade has jurisdiction over civil cases involving trade. Its decisions can be appealed to the U.S. Court of Appeals for the Federal Circuit in Washington and ultimately to the Supreme Court, where the legal challenges to Trump\u2019 tariffs are widely expected to end up.<\/p>\n

Which tariffs did the court block?<\/h4>\n

The court\u2019s decision blocks the tariffs Trump slapped last month on almost all U.S. trading partners<\/a> and levies he imposed before that on China, Mexico and Canada.<\/p>\n

On April 2, Trump imposed so-called reciprocal tariffs of up to 50% on countries with which the United States runs a trade deficit and 10% baseline tariffs on almost everybody else. He later suspended the reciprocal tariffs for 90 days to give countries time to agree to reduce barriers to U.S. exports. But he kept the baseline tariffs in place. Claiming extraordinary power to act without congressional approval, he justified the taxes under IEEPA by declaring the United States\u2019 longstanding trade deficits \u201ca national emergency.\u201d<\/p>\n

In February, he\u2019d invoked the law to impose tariffs on Canada, Mexico and China, saying that the illegal flow of immigrants and drugs across the U.S. border amounted to a national emergency and that the three countries needed to do more to stop it.<\/p>\n

The U.S. Constitution gives Congress the power to set taxes, including tariffs. But lawmakers have gradually let presidents assume more power over tariffs \u2014 and Trump has made the most of it.<\/p>\n

The tariffs are being challenged in at least seven lawsuits. In the ruling Wednesday, the trade court combined two of the cases \u2014 one brought by five small businesses and another by 12 U.S. states.<\/p>\n

The ruling does leave in place other Trump tariffs, including those on foreign steel, aluminum and autos. But those levies were invoked under a different law that required a Commerce Department investigation and could not be imposed at the president\u2019s own discretion.<\/p>\n

Why did the court rule against the president?<\/h4>\n

The administration had argued that courts had approved then-President Richard Nixon\u2019s emergency use of tariffs in a 1971 economic and financial crisis that arose when the United States suddenly devalued the dollar by ending a policy that linked the U.S. currency to the price of gold. The Nixon administration successfully cited its authority under the 1917 Trading With Enemy Act, which preceded and supplied some of the legal language later used in IEPPA.<\/p>\n

The court disagreed, deciding that Trump\u2019s sweeping tariffs exceeded his authority to regulate imports under IEEPA. It also said the tariffs did nothing to deal with problems they were supposed to address. In their case, the states noted that America\u2019s trade deficits hardly amount of a sudden emergency. The United States has racked them up for 49 straight years in good times and bad.<\/p>\n

So where does this leave Trump\u2019s trade agenda?<\/h4>\n

Wendy Cutler, a former U.S. trade official who is now vice president at the Asia Society Policy Institute, says the court\u2019s decision \u201cthrows the president\u2019s trade policy into turmoil.\u201d<\/p>\n