Trump's Controversial Decision: Court Rules Tariffs Unconstitutional
In a significant blow to the Trump administration, a federal court in the United States has revoked the authority to impose extensive tariffs under an emergency law, effectively halting President Donald Trump's aggressive trade policy for now. The ruling initially halted the president's trade policy, which has caused turmoil in global financial markets and cost private investors significantly.
The New York court for international trade has ordered the suspended application of the said tariffs and prohibited them permanently. The decision affects almost all tariffs imposed by Trump's administration, including those imposed on April 8, 2025, dubbed "Liberty Day," as well as certain tariffs on goods from Canada, Mexico, and China.
Despite the legal dispute likely heading to the courts, this could mark a turning point for international trade, with the appeals process potentially allowing tariffs to be reinstated pending a final decision.
The US Constitution grants Congress the sole authority to regulate trade with foreign countries, and the court in Manhattan ruled that Trump exceeded his powers when imposing tariffs on imports. The president's emergency powers to protect the US economy could not override this.
In response, a White House spokesperson sharply criticized the court's decision, citing the trade deficit as a national crisis that weaken American communities, puts workers in distress, and weakens the US defense industry. The spokesperson argued that unelected judges should not decide how to handle a national emergency.
Several lawsuits have been filed against Trump's tariff policy in the U.S., with bipartisan efforts from businesses and state governments to challenge the president's authority in imposing the tariffs.
Trump's trade policy targets the European Union and China, with escalating tensions between the U.S. and the EU due to the latter being accused of "ripping off" the U.S. while Trump seeks to impose higher tariffs on imports to achieve a more balanced global trade.
The legal status of the Trump administration's tariff policy remains unchanged by any reported federal court ruling, as per the latest available sources. The tariff policy carries domestic political risks, as an import tariff functions similarly to a tax, potentially fueling inflation.
(Agencies)
- The UN Court for International Trade's decision to permanently prohibit the suspended application of Trump's tariffs could significantly impact the finance sector, as it may influence future business decisions related to global investments.
- The US Constitution’s stipulation granting Congress exclusive authority over trade regulations might issue a challenge to the politics of imposing tariffs, especially in the context of the ongoing legal disputes over Trump's trade policy.
