On February 20, the U.S. Supreme Court ruled 6–3 that broad global tariffs imposed under emergency powers during the Trump administration were unlawful. The Court found that the president exceeded authority under the International Emergency Economic Powers Act (IEEPA), which does not explicitly authorize tariff-setting powers. The ruling invalidates a significant set of import tariffs that have been in place on goods from many U.S. trading partners and could lead to major changes in trade policy moving forward.
While the Supreme Court ruling struck down some broad tariff authorities, it did not affect tariffs imposed under separate national security laws — meaning key duties on Canadian goods remain in place. Those continuing measures include tariffs on steel, aluminum, automobiles, and lumber, which analysts say have contributed to disruptions in major Canadian industries and ongoing trade uncertainty.
However, the ruling overturns two major categories of tariffs. First, it strikes down country-specific “reciprocal” tariffs, which ranged from a 34% rate on imports from China to a 10% baseline tariff applied to many other countries. Second, it invalidates the 25% tariffs placed on certain goods from Canada, China, and Mexico that the administration said were intended to address concerns over fentanyl trafficking and border security.
In response to the ruling, President Trump signed an Executive Order on February 20 to impose a temporary 10% global tariff for up to 150 days under Section 122 of the Trade Act of 1974 — a statute that allows the president to levy short-term duties of up to 15% to address serious balance-of-payments concerns. According to reports, these tariffs would be applied in addition to the existing duties. On February 22, President Trump announced he would increase the temporary global tariffs from 10% to 15%.
HPBA President & CEO, Jill McClure, said, “The Supreme Court decision underscores how much trade policy and legal certainty matter to small businesses and our industry. HPBA members depend on stable supply chains and predictable pricing to serve their customers and support their local economies. As the implications of this ruling unfold, HPBA will keep advocating for policies that promote affordability and a strong, reliable marketplace for manufacturers, retailers, and consumers.”
HPBA Government Affairs is actively reviewing the decision and monitoring next steps to understand impacts on our industry. We’ll continue to provide updates and analysis as more information becomes available.
For more information, please contact governmentaffairs@hpba.org.