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Tariffs

Trump's Tariff Rationale Faces Skepticism in Court

Strategic Insights

— 2 min read

A panel of 11 US appellate judges expressed doubt over President Donald Trump's ability to impose tariffs without congressional approval, questioning the administration's reliance on the International Emergency Economic Powers Act (IEEPA) to justify the move.

The judges, who are hearing the case in the US Court of Appeals for the Federal Circuit in Washington, were unimpressed by the Trump administration's argument that the president has the power to unilaterally impose tariffs under IEEPA. The 1977 law allows the president to seize assets and block transactions during a national emergency, but it does not explicitly mention tariffs.

Chief Circuit Judge Kimberly Moore posited that if the president could use IEEPA to impose a 20% tax on coffee to boost military readiness, that would not necessarily address the underlying issue. The administration's attorney, Brett Shumate, acknowledged that no president has ever used IEEPA to impose tariffs before, but argued that it was still lawful.

Key Takeaways:

  • The Trump administration's reliance on IEEPA to justify tariffs faces skepticism from a panel of 11 US appellate judges.
  • The judges question whether the law allows for tariffs, and whether the levies imposed by Trump match the supposed threat of a national emergency.
  • Trump's tariffs have raised the average US tariff to over 18%, the highest rate since 1934.
  • The case is expected to reach the US Supreme Court.
  • Trump has used IEEPA to impose tariffs on nearly every country, but the law does not explicitly mention tariffs.
  • The case centers on Trump's "Liberation Day" tariffs of April 2 that imposed new levies on nearly every country.
  • The challenge strikes at just one batch of import taxes from an administration that has unleashed a bevy of them.
  • The US Constitution gives Congress the authority to impose taxes, but lawmakers have over decades ceded power over trade policy to the White House.

Statistics:

  • The average US tariff has risen to over 18%, the highest rate since 1934 (Budget Lab at Yale University).
  • Trump has imposed tariffs on nearly every country, making it the highest tariff rate in decades.
  • The issue now rests with the appeals judges, with no ruling issued from the bench.
  • The case is one of at least seven lawsuits charging that Trump overstepped his authority through the use of tariffs.

Sources:

  • "Trump Faces Scepticism in Court Over Tariffs." New Delhi Times, 2023.
  • Budget Lab at Yale University.
  • The US Constitution.
  • HT Digital Content Services with permission from New Delhi Times.

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