At a Glance:
- Justices from both ideological wings expressed concern that President Trump exceeded his authority by imposing sweeping import taxes without Congress.
- The court’s decision could upend Trump’s trade agenda and create major uncertainty for importers and the federal budget.
WASHINGTON — Members of the U.S. Supreme Court on Wednesday heard oral arguments in a high-stakes case challenging President Donald Trump’s authority to impose sweeping tariffs without congressional approval, with several justices — including key conservatives — signaling doubts about the scope of the President’s trade powers.
Chief Justice John Roberts and Justices Amy Coney Barrett and Neil Gorsuch joined the court’s three liberal justices in pressing U.S. Solicitor General John Sauer, who defended Trump’s use of the International Emergency Economic Powers Act (IEEPA) to levy tariffs on foreign imports.
The questioning suggested that the court’s swing votes may not be convinced that the 1977 law gives the President such far-reaching authority.
“The justification is being used for power to impose tariffs on any product from any country in any amount, for any length of time,” Roberts said. Gorsuch added that he was “struggling” to find a reason to accept Sauer’s arguments, warning that such an interpretation would allow Congress to “abdicate all responsibility to regulate foreign commerce.”
A key issue at play in arguments was whether or not a tariff should be considered a tax. Congress is explicitly vested with the power to raise revenue by the commerce clause of the U.S. Constitution, so treating tariffs as a tax would mean Trump overstepped his constitutional authority by imposing levies earlier this year on China, Mexico and Canada, which he later expanded to cover most trading partners.
At one point, Justice Samuel Alito posed a hypothetical scenario to the petitioners, asking whether a President could use tariffs to “stave off war” with a powerful adversary. Attorney Neil Katyal, representing the challengers, replied that while a president might have authority to impose an embargo or quota in such a case, using tariffs as a revenue-raising tool went beyond the law’s intent. Sauer countered that distinction, arguing the question mischaracterized the issue and that presidents must retain broad discretion over national security and foreign policy decisions.
President Trump’s administration has argued that the measures were necessary to address what it called “country-killing” crises, including drug trafficking and the U.S. trade deficit.
Opponents, including several states and business groups, contend that the IEEPA law was never meant to authorize tariffs. Katyal, arguing for private businesses, called it “implausible” that Congress intended to give the president “the power to overhaul the entire tariff system and the American economy.”
Refunds on the horizon?
If the justices strike down Trump’s tariff authority, one of the most immediate and complex issues will be what happens to the money already collected. According to analysts cited by the BBC, about $90 billion in import taxes have been paid under the disputed tariffs, roughly half of the total tariff revenue the U.S. government has taken in this year through September. That amount could rise dramatically if the court delays its ruling. Trump officials have warned the total could swell to as much as $1 trillion if the court waits to rule until next June.
During arguments, Justice Amy Coney Barrett pressed the lawyers on whether refunding that revenue would be feasible, asking if it would amount to a “complete mess.” Katyal, arguing for the challengers, agreed that the situation would be complicated. He said small businesses might see relatively straightforward refunds, but larger corporations would face lengthy administrative processes to recover the money.
The logistical and financial implications underscore the high stakes of the case. A ruling against the administration could not only reshape the limits of presidential power on trade, but also set off a cascade of refund claims and economic adjustments.
White House Press Secretary Karoline Leavett said Wednesday the administration is preparing “Plan B” options if the court curtails the President’s authority. “It would be imprudent of the President’s advisors not to prepare for such a situation,” she said.
