On February 20, 2026, the United States Supreme Court announced a decision striking down the tariffs imposed on various imports pursuant to Presidential Executive Orders. For many students, the word “tariffs” refers to concepts that we encounter in history and economics courses. There has also been a considerable buzz about “tariffs” in the last year as it relates to the prices of many goods. It is unclear whether businesses have individually or uniformly passed along to the consumers the increased costs resulting from the tariffs. While the definitive outcome of the Supreme Court’s recent decision, in Learing Resources, Inc. et al v. Trump, President of the United States, is that the tariffs at issue have been halted, understanding the reasons why is also instructive.
The majority Supreme Court opinion indicated the Court was not weighing in on any policy debate regarding tariffs, but instead answering the constitutional legal questions posed. So, what was the basis of the Supreme Court’s review and decision?
The United States Constitution does not give a peacetime President the ability to impose tariffs. Instead, the Constitution states that it is Congress that has the power to impose tariffs and pursue taxing measures. The President sought to rely on language in the International Emergency Economic Powers Act (“IEEPA”) as a legal basis for the Executive Branch to issue the tariffs.
The IEEPA does not mention tariffs. Yet, the IEEPA allows a President to address an extraordinary threat to the United States’ national security or economy, which originates from outside the country, upon declaring a national emergency. Additionally, the IEEPA separately states that when there is a national emergency, the President may regulate importation.
Based on these provisions of the IEEPA, the President imposed tariffs after declaring a national emergency on two threats. The first threat the President identified by Executive Order was the inflow of illegal drugs and the resulting public health crisis. The second threat identified in another Executive Order was the pervasive large trade deficits and the risk to crucial supply chains. The actual tariff amounts varied by country, and the President modified various countries’ tariffs over time.
Since the President relied on the IEEPA to impose the tariffs, the question presented to the Supreme Court was whether the IEEPA authorizes the President to issue the tariffs. The Supreme Court held that the President lacked such authority under the IEEPA.
The Supreme Court based its decision on several factors. First of all, the Constitution makes clear that the authority to impose tariffs is a congressional power. Therefore, under separation of powers concepts, the expectation is that if Congress wants to delegate such a principal function to the executive branch, it will do so with clear express statutory language. This did not occur in the IEEPA. The Supreme Court also noted there was no historical precedent for the executive branch to impose tariffs under the IEEPA. In conclusion, the Supreme Court found the President failed to identify definite and unambiguous congressional authorization to support imposing tariffs under the IEEPA.
Three Supreme Court Justices dissented from the majority opinion and instead opined that tariffs are a form of regulation of importation, and the IEEPA, therefore, allows the President to impose tariffs. The Dissenting Justices also noted that other federal statutes, such as the Trade Act of 1974, allow a President to impose tariffs if the statutory requirements are followed.
Following the issuance of the Supreme Court decision, the President announced the imposition of import tariffs pursuant to the Trade Act of 1974. It is unclear how future trade agreements or already collected tariffs will be handled. What is clear is that the concept of tariffs continues to evoke questions and commentary.
When asked his opinion about the Supreme Court’s ruling, Pine Crest history teacher Mr. Gratwick remarked, “In his 1776 work, ‘Wealth of Nations,’ Adam Smith wrote, essentially, that freer trade brings greater prosperity. The trend in tariff rates worldwide has been down since the end of World War II in 1945.”
In considering the recent Supreme Court decision on tariffs, it is clear that the topic of separation of powers between Congressional and Executive functions continues to be a topic analyzed and considered throughout history up to the modern day.
