MarketWatch / May 28, 2025
In a ruling late Wednesday, the 3-member New York-based Court of International Trade blocked Trump’s tariffs dating back to Feb. 1 — including the ”liberation day” tariffs announced April 2 against almost all of America’s trading partners, most of which have been paused — saying they are unconstitutional because the president does not have unlimited authority to impose tariffs.
Congress typically must approve tariffs, but the Trump administration claimed that under the International Emergency Economic Powers Act of 1977, the president could impose the tariffs due to a national emergency, citing trade deficits.
The U.S. has run trade deficits for nearly 50 years, and the court said they did not constitute an extraordinary threat.
While the law allows the president to “regulate…importation,” “those words do not confer unlimited tariff authority,” the court said.
“An unlimited delegation of tariff authority would constitute an improper abdication of legislative power to another branch of government,” the court wrote.
The court added that in a 1974 trade act, Congress set “specific limits on the president’s authority to respond to balance-of-payments problems,” and that under that act, “even ‘large and serious United States balance-of-payments deficits’ do not necessitate the use of emergency powers.”
The ruling pulls the rug out from one of the Trump administration’s signature policies, and it was unclear how it would affect ongoing talks with U.S. trade partners, including the European Union, or recent trade agreements with China and the U.K.
The ruling came in response to two lawsuits, one from a group of small businesses that specifically challenged the “liberation day” tariffs and the other by a group of attorneys general from Democratic states that targeted the entire slate of tariffs.
The White House quickly appealed the ruling Wednesday night, with spokesperson Kush Desai saying “it is not for unelected judges to decide how to properly address a national emergency,” adding that the administration is “committed to using every lever of executive power to address this crisis and restore American Greatness.”
https://www.cit.uscourts.gov/