In a major ruling that has ramifications across the globe, the Supreme Court of the United States (SCOTUS) has held that President Donald Trump cannot impose tariffs under the International Emergency Economic Powers Act (IEEPA). [Learning Resources Inc v. Trump]

The judgment came in a bunch of suits where businesses and several US states challenged the sweeping tariffs imposed by Trump during a declared national emergency.

The Court ruled that the tariffs were unlawful because the Constitution vests the power to impose duties and taxes in Congress alone.

By a 6-3 majority, the Court held that the President lacks the authority to impose tariffs under IEEPA. Chief Justice Roberts authored the opinion of the Court, joined in full or in part by Justices Sotomayor, Kagan, Gorsuch, Barrett and Jackson. While all six agreed on the final judgment, they were divided on the reasoning: Roberts, Gorsuch and Barrett invoked the "major questions doctrine" to require clear congressional authorisation for such significant economic action. Kagan, Sotomayor and Jackson argued that standard statutory interpretation was sufficient to strike down the tariffs without needing that specific doctrine.

On the other side, Justice Kavanaugh penned the primary dissent, joined by Justices Thomas and Alito, arguing that "regulate importation" historically encompasses the power to levy duties. Justice Thomas also filed a separate dissent, asserting that because importing is a privilege rather than a right, the non-delegation doctrine does not bar Congress from handing this power to the executive.

At the heart of the dispute is the interpretation of IEEPA. It is a 1977 US federal law that gives the President broad authority to respond to unusual and extraordinary foreign threats during a declared national emergency. Once such an emergency is declared, the statute allows the executive to investigate, block, regulate or prohibit financial transactions and trade involving foreign countries or nationals in order to protect national security, foreign policy or the economy.

Traditionally, IEEPA has been used to impose economic sanctions, freeze assets, restrict financial flows and block imports or transactions involving hostile states, terrorist groups or sanctioned entities.

SCOTUS, however, ruled that the IEEPA does empower the President to impose tariffs on other nations.

Shortly after taking office, President Trump identified two "unusual and extraordinary" foreign threats to the United States: the influx of illegal drugs from Canada, Mexico and China; and "large and persistent" trade deficits.

On August 6, 2025, the President imposed tariffs on India for its role in "directly or indirectly importing Russian Federation oil," though these duties were later reduced on February 6, 2026, after the government reported that India had committed to halting those imports.

To address these, he declared national emergencies and invoked IEEPA to impose two sets of tariffs:

• Drug trafficking tariffs: A 25% duty on most Canadian and Mexican imports and a 10% duty on most Chinese imports.

• Reciprocal tariffs: A duty of at least 10% on all imports from all trading partners to combat trade deficits.

• Modifications: The President issued several adjustments, including increasing the total effective tariff rate on most Chinese goods to 145%.

The majority opinion, delivered by Chief Justice Roberts, relied on constitutional structure and the major questions doctrine.

1. Taxation is a Congressional power

The Court emphasised that Article I, Section 8 of the Constitution specifies that Congress shall have the power to lay and collect taxes, duties, imports and excises. Chief Justice Roberts highlighted the exclusive nature of this authority:

"The Framers recognized the unique importance of this taxing power—a power which 'very clear[ly]' includes the power to impose tariffs. And they gave Congress 'alone... access to the pockets of the people.'"

Because a tariff is a tax levied on imported goods, the Court ruled that the framers never intended to vest any part of this power in the executive branch.

2. The major questions doctrine

The Court applied the major questions doctrine, which suggests that Congress does not delegate highly consequential power through ambiguous language. The President claimed authority over the national economy that could reduce the deficit by $4 trillion. The Court was skeptical that Congress would hide the power to tax within the general word "regulate." Chief Justice Roberts summarised the standard the President failed to meet:

"Accordingly, the President must 'point to clear congressional authorization' to justify his extraordinary assertion of the power to impose tariffs. He cannot."

3. Statutory silence

The Court noted that the IEEPA lists several actions the President can take, such as "block," "nullify" and "prohibit" - but "tariffs" and "duties" are never mentioned. Chief Justice Roberts concluded:

"We are therefore skeptical that in IEEPA—and IEEPA alone—Congress hid a delegation of its birth-right power to tax within the quotidian power to 'regulate.'"

Justice Kagan wrote in her opinion,

"IEEPA gives the President significant authority over transactions involving foreign property, including the importation of goods. But in that generous delegation, one power is conspicuously missing. Nothing in IEEPA’s text, nor anything in its context, enables the President to unilaterally impose tariffs. And needless to say, without statutory authority, the President’s tariffs cannot stand."

Justice Gorsuch stated that major decisions affecting the rights and responsibilities of Americans, including the duty to pay taxes and tariffs, are funneled through the legislative process for a reason.

"For those who think it important for the Nation to impose more tariffs, I understand that today’s decision will be disappointing...In all, the legislative process helps ensure each of us has a stake in the laws that govern us and in the Nation’s future...the day will come when those disappointed by today’s result will appreciate the legislative process for the bulwark of liberty it is."

[Read Judgment]