Supreme Court weighs whether Trump can impose tariffs without Congress

The Supreme Court is deciding Learning Resources, Inc. v. Trump, which consolidates challenges from small businesses and a dozen state attorneys general. The case turns on one question: does the International Emergency Economic Powers Act of 1977 let the president impose tariffs, or did Congress reserve that power for itself? Both lower courts — the Court of International Trade in May 2025 and the Federal Circuit en banc in August 2025 — ruled that IEEPA does not authorize tariffs.

The Constitution gives Congress — not the president — the power to lay and collect Taxes, Duties, Imposts and Excises (Article I, Section 8). Congress has traditionally delegated some trade authority to presidents since the Reciprocal Trade Agreements Act of 1934, but challengers argue that IEEPA never explicitly granted tariff-setting power and that interpreting it that way would let presidents bypass Congress on any economic matter by declaring an emergency.

Trump used IEEPA to impose tariffs on China starting in February 2025, then extended tariffs to Canada and Mexico in March 2025, and applied them to virtually all U.S. trading partners by April 2025. In the 69 times presidents have invoked IEEPA since 1977, Trump was the first to use it to impose tariffs. No prior administration read the statute that broadly.

U.S. Customs and Border Protection collected roughly $133.5 billion in IEEPA-based tariff revenue through December 2025 — about 60% of all tariff revenue collected during that period. If the Supreme Court strikes down the tariffs, the government would face pressure to refund those payments. By early 2026, nearly 2,000 importers had already filed protective lawsuits at the Court of International Trade to preserve their refund rights.

The weighted average applied tariff rate on all U.S. imports rose from 1.5% in 2022 to 13.5% in 2026 — the highest since 1946. The Tax Foundation estimates these tariffs cost the average American household $1,000 in 2025 and $1,300 in 2026. Lower-income households face an effective tax increase of about 1.9%, compared with 1.4% for higher-income earners, making the tariff burden regressive.

Small furniture retailers face a particularly acute crisis. A 25% tariff on upholstered furniture, kitchen cabinets, and vanities took effect in 2025, with rates on some products scheduled to rise to 50% in 2026 before a December 31 presidential proclamation delayed the increase. One small furniture retailer reported raising prices 15-18% to absorb tariff costs, triggering a demand slide during the 2025 holiday season. Large retailers with deep pockets can absorb the shock; smaller independent retailers cannot.

During three hours of oral argument on November 5, 2025, a majority of justices appeared skeptical of the administration position. The government argued IEEPA places the tariffs in Zone 1 of the Youngstown framework — maximum authority because Congress authorized emergency economic powers. Challengers countered that IEEPA authorization to regulate importation cannot reasonably mean unlimited tariff power, and extending it that far would give presidents unilateral authority to remake the global economy through emergency declarations.

If the Court strikes down the tariffs, the administration has fallback options. Section 122 of the Trade Act allows worldwide tariffs for balance-of-payments reasons, but caps them at 15% and limits them to 150 days. Section 232 (national security tariffs on steel and aluminum) and Section 301 (unfair trade practices against specific countries) remain on firmer legal ground but have narrower scope. The Freshfields law firm identified a third scenario where the administration offers credits against future duties rather than cash refunds.

Three House Republicans — TMThomas Massie (KY), Don Bacon (NE), and Kevin Kiley (CA) — voted against a February 10 procedural rule that would have shielded Trump tariffs from congressional challenges through the August recess. The measure failed 214-217. The House had already passed a joint resolution ending the 35% tariff on Canadian imports, the first sign of organized Republican resistance. Roll Call reported that swing-district Republicans face mounting constituent pressure from higher consumer prices.