News February 20, 2026
Supreme Court Rules President Trump’s Sweeping Tariffs Unconstitutional
The administration is expected to use other legal avenues to levy tariffs as it remains unclear if businesses will receive refunds.
Key Takeaways
• The Supreme Court ruled 6–3 that President Trump exceeded his authority under the International Emergency Economic Powers Act (IEEPA) when imposing broad reciprocal tariffs, striking down the 10% tariff on most countries and higher levies on others.
• According to the ruling, IEEPA cannot be used to justify tariffs, though the administration has indicated it will continue pursuing tariffs through other legal avenues.
• Businesses that paid the now-invalidated tariffs may be eligible for refunds, but the process is expected to be complex and slow, leaving long-term tariff impacts and future policy moves uncertain for the promo industry.
The Supreme Court has struck down President Trump’s tariffs in a historic and long-awaited decision. However, exactly what comes next regarding the future of tariffs remains unclear.
In a 6-3 ruling, the court determined Friday that the president violated federal law when he imposed reciprocal tariffs under the justification of the International Emergency Economic Powers Act. The ruling strikes down the 10% tariff Trump imposed on nearly all countries last year, as well as higher tariffs on countries including Canada, Mexico and China.
“The president asserts the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope,” Chief Justice John Roberts wrote in the majority opinion for the court. “In light of the breadth, history, and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise it.”
IEEPA gives the president the power to regulate importation during times of emergency, but the question on the docket was whether it could be used to justify tariffs.
“Under IEEPA, it doesn’t say the word ‘tariffs,’” Nicole Bivens Collinson, a managing principal and operating committee member who leads the government relations and international trade practice group at Sandler, Travis & Rosenberg, P.A., told ASI Media last year. “So, the question is, is it legal to use tariffs in the context of IEEPA?”
The answer, according to the court’s majority opinion, is no. But that doesn’t mean Trump will back down on his tariff strategy. The administration has repeatedly said it will use other measures and justifications to impose levies on foreign goods, and has already tapped Section 232 and Section 301 as other avenues for enacting tariffs. Just hours after the initial ruling Friday, President Trump publicly denounced the decision, saying the justices who sided against his use of tariffs should be "absolutely ashamed," and threatened to use alternative mechanisms to slap a 10% global tariff on top of existing levies. However, the alternative avenues he plans to leverage could have more guardrails than IEEPA.
"We're going to see the [Trump] administration reimpose different tariffs, but they'll be more process oriented," says Babak Hafezi, the CEO of international trade analysis firm Hafezi Capital, and an adjunct professor of international business at American University. "They won't be country specific, but will instead be industry specific. And importantly, they will be capped at a certain percentage."
Now that the ruling is in, businesses who have had to pay these levies could be eligible for a refund. But the payback process is a complicated one. The ruling didn’t provide specific guidance on refunds. For many, that was no surprise. Trade attorneys and other legal experts have warned these payments could be delayed – and could take up to several years to be fully paid out.
Despite ongoing uncertainty around what the tariffs will mean for promo, Hafezi sees the ruling as a historic one.
"The fact that we have a Supreme Court that still believe that trade rules matter is critically important," he said. "The confidence in the U.S. as a trading partner for the rest of the world increased today.”