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The U.S. Supreme Court has ruled the president does not have the authority to impose tariffs on imported goods using emergency powers.
In a 6-3 decision, the justices said the International Emergency Economic Powers Act does not give the president the power to levy tariffs, emphasizing that authority belongs to Congress under the Constitution.
Travis Cushman, deputy general counsel for litigation and public policy with the American Farm Bureau Federation, says the ruling does not end the matter.
He says, “The Constitution grants Congress the exclusive authority to tax and tariff, and so if Congress wants to levy a tax, they can do that. The president does not have that authority. About half of the tariffs were under IEEPA, the new tariffs, and the other half were in other sections, so the other sections can provide an avenue for those.”
Cushman says the case now moves immediately to an international appeals court to determine what happens to existing tariffs and how the decision will be applied.
“It is unclear what happens to the tariffs that have been collected, if those will be refunded, who gets the money, how much it is, and it’s also unclear if the President will try to use other statutes to levy tariffs. The other options are much more clunky and difficult to administer.”
For agriculture, the decision could have major implications, since tariffs often affect export markets and input costs.
Cushman adds, “Inputs that are foreign derived should go down without those tariffs in place. The question is what happens to our export markets, whether they have been lessened from retaliatory tariffs or smaller purchases. It’s also uncertain if new tariffs will be levied. Any current restrictions that are in place on other countries on our imports will immediately go away.”
For now the broader tariff debate is far from over, as policymakers consider their next move.