Federal court blocks Trump from imposing sweeping tariffs under
emergency powers law
[May 29, 2025]
By LINDSAY WHITEHURST and JOSH BOAK
WASHINGTON (AP) — A federal court on Wednesday blocked President Donald
Trump from imposing sweeping tariffs on imports under an
emergency-powers law, swiftly throwing into doubt Trump’s signature set
of economic policies that have rattled global financial markets,
frustrated trade partners and raised broader fears about inflation
intensifying and the economy slumping.
The ruling from a three-judge panel at the New York-based U.S. Court of
International Trade came after several lawsuits arguing Trump's
“Liberation Day” tariffs exceeded his authority and left the country's
trade policy dependent on his whims.
Trump has repeatedly said the tariffs would force manufacturers to bring
back factory jobs to the U.S. and generate enough revenue to reduce
federal budget deficits. He used the tariffs as a negotiating cudgel in
hopes of forcing other nations to negotiate agreements that favored the
U.S., suggesting he would simply set the rates himself if the terms were
unsatisfactory.
White House spokesperson Kush Desai said that trade deficits amount to a
national emergency “that has decimated American communities, left our
workers behind, and weakened our defense industrial base — facts that
the court did not dispute.”
The administration, he said, remains “committed to using every lever of
executive power to address this crisis and restore American Greatness.”
But for now, Trump might not have the threat of import taxes to exact
his will on the world economy as he had intended, since doing so would
require congressional approval. What remains unclear is whether the
White House will respond to the ruling by pausing all of its emergency
power tariffs in the interim.
Trump might still be able to temporarily launch import taxes of 15% for
150 days on nations with which the U.S. runs a substantial trade
deficit. The ruling notes that a president has this authority under
Section 122 of the Trade Act of 1974.
The ruling amounted to a categorical rejection of the legal
underpinnings of some of Trump’s signature and most controversial
actions of his four-month-old second term. The administration swiftly
filed notice of appeal — and the Supreme Court will almost certainly be
called upon to lend a final answer — but it casts a sharp blow.
The case was heard by three judges: Timothy Reif, who was appointed by
Trump, Jane Restani, named to the bench by President Ronald Reagan and
Gary Katzman, an appointee of President Barack Obama.
“The Worldwide and Retaliatory Tariff Orders exceed any authority
granted to the President by IEEPA to regulate importation by means of
tariffs,” the court wrote, referring to the 1977 International Emergency
Economic Powers Act.
The ruling left in place any tariffs that Trump put in place using his
Section 232 powers from the Trade Expansion Act of 1962. He put a 25%
tax on most imported autos and parts, as well as on all foreign-made
steel and aluminum. Those tariffs depend on a Commerce Department
investigation that reveals national security risks from imported
products.
[to top of second column]
|
Containers are pictured at a cargo terminal in Frankfurt, Germany,
Thursday, May 22, 2025. (AP Photo/Michael Probst)
It was filed in the U.S. Court of International Trade, a federal
court that deals specifically with civil lawsuits involving
international trade law.
While tariffs must typically be approved by Congress, Trump has said
he has the power to act to address the trade deficits he calls a
national emergency.
He is facing at least seven lawsuits challenging the levies. The
plaintiffs argued that the emergency powers law does not authorize
the use of tariffs, and even if it did, the trade deficit is not an
emergency because the U.S. has run a trade deficit with the rest of
the world for 49 consecutive years.
Trump imposed tariffs on most of the countries in the world in an
effort to reverse America’s massive and long-standing trade
deficits. He earlier plastered levies on imports from Canada, China
and Mexico to combat the illegal flow of immigrants and the
synthetic opioids across the U.S. border.
His administration argues that courts approved then-President
Richard Nixon’s emergency use of tariffs in 1971, and that only
Congress, and not the courts, can determine the “political” question
of whether the president’s rationale for declaring an emergency
complies with the law.
Trump’s Liberation Day tariffs shook global financial markets and
led many economists to downgrade the outlook for U.S. economic
growth. So far, though, the tariffs appear to have had little impact
on the world’s largest economy.
The lawsuit was filed by a group of small businesses, including a
wine importer, V.O.S. Selections, whose owner has said the tariffs
are having a major impact and his company may not survive.
A dozen states also filed suit, led by Oregon. “This ruling
reaffirms that our laws matter, and that trade decisions can’t be
made on the president’s whim,” Attorney General Dan Rayfield said.
Oregon Sen. Ron Wyden, top Democrat on the Senate Finance Committee,
said the tariffs had "jacked up prices on groceries and cars,
threatened shortages of essential goods and wrecked supply chains
for American businesses large and small.″
___
Associated Press writers Zeke Miller and Paul Wiseman contributed to
this story.
All contents © copyright 2025 Associated Press. All rights reserved |
