A U.S. Court of International Trade on Thursday ruled that President Donald Trump’s recent 10% global tariffs are unlawful, siding with 24 states and several businesses that challenged the tariffs’ legality.
The court issued a 2-1 decision declaring the tariffs, imposed under Section 122 of the Trade Act of 1974, invalid. These tariffs were introduced in February after the Supreme Court struck down Trump’s previous round of tariffs issued under the International Emergency Economic Powers Act (IEEPA), which the court found exceeded presidential authority.
Following the Supreme Court’s April 2025 decision that the IEEPA did not authorize tariff imposition, the Trump administration imposed temporary tariffs using Section 122, which allows tariffs for up to 150 days to address “large and serious balance-of-payments deficits.” However, the trade court found that the administration failed to meet the legal requirements, as the proclamation focused on the U.S. trade and current account deficits rather than the balance-of-payments deficit required by law.
The ruling orders the administration to stop collecting these tariffs from the state of Washington and the two corporate plaintiffs that filed suit. It also mandates refunds with interest for tariffs already paid by these plaintiffs. The court did not issue a nationwide injunction to halt tariffs against all importers.
Two judges appointed by President Barack Obama formed the majority, while a judge appointed by President George W. Bush dissented.
Former President Trump responded to the ruling by criticizing the judiciary, calling the judges “radical left” and stating that his tariff strategy would continue to adapt to legal setbacks.
Why it matters
This ruling limits the ability of the executive branch to impose broad tariffs without clear legislative backing, reinforcing judicial oversight over presidential trade actions. It sends a signal that tariffs must comply precisely with statutory criteria, which affects U.S. trade policy and ongoing governmental attempts to address economic imbalances through tariffs.
The decision also obligates the administration to provide financial relief to specific plaintiffs harmed by the tariffs, demonstrating potential legal and financial risks associated with imposing contested tariffs.
Background
Trump initially imposed sweeping global tariffs under the IEEPA in 2025, which the Supreme Court invalidated, stating the act did not grant tariff authority. Subsequently, the administration turned to Section 122 of the Trade Act to apply temporary tariffs aimed at addressing balance-of-payments deficits. The administration plans to conduct further investigations under other legal provisions to impose longer-term tariffs, but those steps remain ongoing.
The controversies around the tariffs highlight broader tensions between executive authority, judicial interpretation, and trade policy objectives amidst ongoing debates over protectionism and economic strategy in U.S. trade relations.
Sources
This article is based on reporting and publicly available information from the following source:
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