Global Daily Tax News, Court Bars Trump From Imposing Tariffs On US Trading Partners, (May 30, 2025)

In a major setback for US President Donald Trump's tariff agenda, the US Court of International Trade has ruled the President lacks the authority to impose steep tariffs on America's trading partners independent of Congress.

The Court sided with arguments put forward by several small businesses and a coalition of US state governments. It agreed that only Congress has the authority to impose tariffs on other nations' exports that would ramp up taxes paid by American consumers and businesses.

The Court ruled that Trump may not rely on provisions in the International Emergency Economic Powers Act to bypass Congress, purportedly on the basis of an "unusual and extraordinary threat [...] to the national security, foreign policy, or economy of the United States."

The US Administration immediately announced its decision to appeal the ruling, with the Administration currently ordered to withdraw the tariff policies within 10 days.

Previously, the US Administration paused its reciprocal tariffs on other nations' exports for a period of 90 days, until July 9, 2025. In the interim, a 10-percent tariff rate applies, in place of tariffs as high as 50 percent.

The Court's ruling also applies to the 20-percent fentanyl levy additionally applied to trade with Canada, Mexico, and China. However, it does not cover tariffs on vehicles, steel, and aluminum.