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Can Trump use IEEPA to impose tariffs? What Act says amid court's ‘illegal’ ruling
A US federal appeals court on Friday said that most of President Trump's tariffs, impacting numerous trading partners, were illegal.
Most of Donald Trump's tariffs, which impact numerous trading partners, are illegal, a US federal appeals court ruled on Friday, but allowed them to remain in place for now.
The 7-4 ruling by the US Court of Appeals for the Federal Circuit affirmed a decision made by a lower court, which found that Trump had exceeded his authority in tapping emergency economic powers to impose wide-ranging duties.
Since he returned to the presidency in January, Trump has invoked the International Emergency Economic Powers Act (IEEPA) to impose tariffs on almost all US trading partners.
What is IEEPA?
The International Emergency Economic Powers Act (IEEPA) gives the President broad authority to regulate a variety of economic transactions following a declaration of national emergency. IEEPA, like the Trading with the Enemy Act (TWEA) from which it branched, is at the center of the modern US sanctions regime.
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While TWEA has been used by Presidents to impose tariffs, no President has thus far used IEEPA to ‘place tariffs on imported products from a specific country or on products imported to the United States in general.’
However, Congress report notes “IEEPA's similarity to TWEA, coupled with its relatively frequent use to ban imports and exports, suggests that such an action could happen.”
What did the court ruling say?
Meanwhile, Friday's court ruling has said of IEEPA – the statute bestows significant authority on the President to undertake a number of actions in response to a declared national emergency, but none of these actions explicitly include the power to impose tariffs, duties, or the like, or the power to tax.
What next for the Trump government?
The judges have allowed the tariffs to stay in place through mid-October, which would allow parties time to take the matter to the Supreme Court.
However, the decision comes as a blow to Trump who had used tariffs as a wide-ranging economic policy tool. The ruling could also raise doubts on deals Trump has recently made with major trading partners, like the one with the European Union.
Trump, meanwhile, responded to the ruling via a post on his social media platform – Truth Social.
“ALL TARIFFS ARE STILL IN EFFECT! Today a Highly Partisan Appeals Court incorrectly said that our Tariffs should be removed, but they know the United States of America will win in the end,” the President said.
“If these Tariffs ever went away, it would be a total disaster for the Country. It would make us financially weak, and we have to be strong. The U.S.A. will no longer tolerate enormous Trade Deficits and unfair Tariffs and Non Tariff Trade Barriers imposed by other Countries, friend or foe, that undermine our Manufacturers, Farmers, and everyone else,” he added.
The Republican continued, “If allowed to stand, this Decision would literally destroy the United States of America. At the start of this Labor Day weekend, we should all remember that TARIFFS are the best tool to help our Workers, and support Companies that produce great MADE IN AMERICA products. For many years, Tariffs were allowed to be used against us by our uncaring and unwise Politicians. Now, with the help of the United States Supreme Court, we will use them to the benefit of our Nation, and Make America Rich, Strong, and Powerful Again! Thank you for your attention to this matter.”
Notably, the US Court of International Trade had ruled in May that Trump had overstepped his authority with these global levies.
(With AFP inputs)
