A divided U.S. appeals court ruled on Friday that most of Donald Trump's tariffs are illegal, undercutting the Republican president's use of the levies as a key international economic policy tool.
The court allowed the tariffs to remain in place through October 14 to give the Trump administration a chance to file an appeal with the U.S. Supreme Court. Trump has made tariffs a pillar of U.S. foreign policy in his second term, using them to exert political pressure and renegotiate trade deals with countries that export goods to the United States.
The tariffs have given the Trump administration leverage to extract economic concessions from trading partners but have also increased volatility in financial markets.
"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," the court said.
The Treasury, the U.S. Trade Representative's office and the Commerce Department had no immediate response to the ruling.
The 7-4 decision from the U.S. Court of Appeals for the Federal Circuit in Washington, D.C., addressed the legality of what Trump calls "reciprocal" tariffs imposed as part of his trade war in April, as well as a separate set of tariffs imposed in February against China, Canada and Mexico.
Democratic presidents appointed six judges in the majority and two judges who dissented, while Republican presidents appointed one judge in the majority and two dissenters.
The court's decision does not impact tariffs issued under other legal authority, such as Trump's tariffs on steel and aluminum imports.
Trump justified both sets of tariffs - as well as more recent tariffs - under the International Emergency Economic Powers Act. IEEPA gives the president the power to address "unusual and extraordinary" threats during national emergencies.
The court allowed the tariffs to remain in place through October 14 to give the Trump administration a chance to file an appeal with the U.S. Supreme Court. Trump has made tariffs a pillar of U.S. foreign policy in his second term, using them to exert political pressure and renegotiate trade deals with countries that export goods to the United States.
The tariffs have given the Trump administration leverage to extract economic concessions from trading partners but have also increased volatility in financial markets.
"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," the court said.
The Treasury, the U.S. Trade Representative's office and the Commerce Department had no immediate response to the ruling.
The 7-4 decision from the U.S. Court of Appeals for the Federal Circuit in Washington, D.C., addressed the legality of what Trump calls "reciprocal" tariffs imposed as part of his trade war in April, as well as a separate set of tariffs imposed in February against China, Canada and Mexico.
Democratic presidents appointed six judges in the majority and two judges who dissented, while Republican presidents appointed one judge in the majority and two dissenters.
The court's decision does not impact tariffs issued under other legal authority, such as Trump's tariffs on steel and aluminum imports.
Trump justified both sets of tariffs - as well as more recent tariffs - under the International Emergency Economic Powers Act. IEEPA gives the president the power to address "unusual and extraordinary" threats during national emergencies.
