In a 6 to 3 decision, the Supreme Court of the United States ruled that the President does not have unilateral authority to impose tariffs under the International Emergency Economic Powers Act. The case, brought by small US businesses affected by increased import costs, centered on whether emergency powers could be used to implement sweeping trade tariffs. The majority opinion concluded that the law does not grant the executive branch broad tariff-setting authority, reinforcing that trade policy powers ultimately rest with Congress. The decision marks a significant moment in defining the limits of executive authority in economic and trade matters.

The ruling leaves several practical questions unresolved, including how previously collected tariff revenues may be handled and what legal avenues might be pursued for future trade actions. Shortly after the decision, President Trump announced a temporary 10 percent tariff under a different section of federal trade law, signaling that additional policy shifts may follow. For contractors and suppliers, the outcome highlights ongoing uncertainty in trade policy and its potential impact on material costs, supply chains, and pricing as the situation continues to evolve. Click here to read more.