President Donald Trump overstepped his authority to place emergency tariffs on most goods imported into the US, a federal appeals court said in a sweeping decision today that will remain on hold until at least 14 October.
The US Court of Appeals for the Federal Circuit, in a split 7-4 ruling, affirmed a lower court ruling from May that said Trump did not have the ability to unilaterally impose tariffs under a law called the International Emergency Economic Powers Act (IEEPA). The ruling, if upheld, would invalidate many of the tariffs that Trump has imposed since taking office and eventually require the US to issue refunds, although the ruling does not apply to separate sectoral tariffs such as those on steel and automobiles.
Trump has used IEEPA to impose tariffs of 10-50pc on nearly all global trading partners, although he has exempted most energy imports. Among those tariffs are Trump's unilateral decision to increase tariffs to 50pc on Brazil in retaliation for criminal charges against its former president, along with the 50pc tariffs on India ostensibly in retaliation for purchasing Russian crude.
The appeals court today put its ruling on hold until at least 14 October to provide the White House time to file an appeal to the US Supreme Court. If the administration files an appeal, the decision would remain on hold until the Supreme Court rejects the appeal or reaches a final decision, which means the tariffs will remain in effect in the near-term.
Trump, in a social media post, criticized the ruling from what he says is a "Highly Partisan Appeals Court". He said with the "help" of the Supreme Court, where Republican appointees have a 6-3 majority, the tariffs will ultimately be upheld. Trump has previously said it would be "impossible" to pay back the tariffs he has imposed.
"If allowed to stand, this Decision would literally destroy the United States of America," Trump wrote today.
The US Court of International Trade, in a ruling in May, previously found that Trump's emergency tariffs under IEEPA were unlawful and that any tariffs collected would need to be refunded to importers. The US Court of Appeals for the Federal Circuit on 29 May quickly imposed an administrative stay putting that ruling on hold, and held oral arguments on 31 July.
The court, in its ruling today, said it was not deciding if IEEPA authorized the president to issue tariffs, but instead said it was deciding whether Trump's country-specific "reciprocal" tariffs and separate tariffs tied to drug trafficking were lawful. The court noted that IEEPA does not explicitly mention the word tariff, making it seem "unlikely" that Congress intended to give the president "unlimited authority to mention tariffs." The court also said the tariffs ran afoul of what is known as the "majority questions doctrine", which states that it is up to Congress to decide questions of major economic significance.
In a dissent, circuit judge Richard Taranto and three other judges said they believed IEEPA provided an open congressional grant of emergency authority to impose import tariffs
