A major piece of Donald Trump’s trade legacy has hit a legal wall. This week, the U.S. Court of International Trade ruled that the former president overstepped his authority in imposing sweeping tariffs on a wide range of imports — a significant rebuke to one of the more controversial pillars of his economic agenda.
At the heart of the court’s decision is a constitutional question: who holds the power to regulate international commerce? According to the three-judge panel, that authority belongs squarely with Congress, not the president. The ruling found that the Trump administration misapplied a 1977 law — the International Emergency Economic Powers Act — in its attempt to justify tariffs on goods from nearly every major trading partner.
The decision stems from two separate but related lawsuits. One was filed by the Liberty Justice Center on behalf of small businesses that rely on imports now facing steep duties. The other came from a coalition of a dozen U.S. states, led by New York, which argued that the tariffs amounted to an unauthorized tax on Americans.
The court didn’t stop at striking down the broad tariffs tied to national emergency claims. It also blocked a separate set of levies placed on imports from China, Mexico, and Canada. These had been framed by the Trump administration as a response to illegal drug flows and immigration concerns. Notably, the ruling does not touch tariffs on specific goods like steel, aluminum, or cars, which were imposed under different legal provisions.
The White House quickly signaled its intent to appeal, with a deputy press secretary calling the decision a judicial overreach. “It is not for unelected judges to decide how to properly address a national emergency,” said Kush Desai, defending the administration’s use of executive power.
New York Attorney General Letitia James welcomed the outcome. “The law is clear,” she said. “No president can unilaterally raise taxes at will. These tariffs were a hidden tax on working families and businesses, and would have only worsened inflation and job losses if left in place.”
Financial markets appeared to breathe a sigh of relief. Global stocks climbed in response, with gains seen across Asia and in U.S. futures trading. The dollar also strengthened against traditional safe havens like the yen and Swiss franc.
As the legal battle heads for appeal, the decision raises broader questions about the limits of presidential authority — and how trade policy will be shaped going forward in a deeply divided political landscape.
