US Supreme Court Overrules Trump's Tariffs, President Announces New 10% Global Duty
In a surprising move, the United States Supreme Court has ruled against President Donald Trump's sweeping global tariffs, stating that he had overstepped his executive authority. In response, Trump has announced a new 10% tariff on all imports, which is set to come into effect on February 24 and last for 150 days.
Background and Context
The Supreme Court's decision comes after a 6-3 ruling that concluded President Trump had exceeded his authority when he imposed import taxes on almost every country in the world, under the International Emergency Economic Powers Act (IEEPA). The court stated that the Constitution vests the power to impose tariffs and taxes in Congress alone. However, Trump has been quick to respond to this setback, pivoting to a new 10% global tariff which he announced while speaking at the White House.
Key Developments
The new tariffs, which apply to all countries, are an addition to some existing ones which will remain in force. Certain goods such as meat, oranges, and critical minerals are exempt from the tariff. The new order is based on a different law that was not challenged by the Supreme Court, although it is limited to 150 days and can only be extended by a vote from Congress.
President Trump said in response to the ruling, “The Supreme Court did not overrule tariffs, they merely overruled a particular use of IEEPA tariffs. Now I’m going to go in a different direction, probably the direction that I should have gone the first time.”
Reactions and Implications
The Supreme Court's decision has injected new uncertainty into global trade, with questions arising over whether people can get a refund over the unlawful tariffs. Trump’s tariff strategy had been criticised as an unfair tax on Americans, with some Democrats calling the Supreme Court's decision a big victory for the American people.
Despite the Supreme Court's ruling, foreign leaders and executives assume that U.S. tariffs are here to stay, in one form or another. However, the judgement offers some hope of relief for countries such as South Africa, which had been hit by punitive tariffs.
Conclusion
Despite the Supreme Court's ruling and the criticisms, President Trump remains undeterred in his economic agenda and continues to assert that tariffs are critical to national security. The new 10% global tariff, which is set to come into effect on February 24, will remain valid for 150 days. The future of global trade and the impact of these tariffs remain to be seen.