Donald Trump
Olayiwola Mercy
US President Donald Trump has announced an increase in the global tariff rate from 10% to 15%, citing the Supreme Court’s ruling as “ridiculous, poorly written, and extraordinarily anti-American”. This move comes after the Supreme Court struck down Trump’s previous tariff regime, which was imposed using the International Emergency Economic Powers Act (IEEPA). The new tariff rate will be imposed under Section 122 of the Trade Act of 1974, allowing for temporary tariffs of up to 15% for 150 days.
The decision is expected to have significant implications for global trade, with countries like India, Brazil, and China potentially seeing reduced tariff rates. However, some countries, like Argentina, Australia, Saudi Arabia, and the UK, may face higher tariffs. The move has been met with mixed reactions, with some countries welcoming the ruling and others expressing concerns about the impact on trade deals and economic growth.
The Supreme Court’s decision does not remove tariffs from the table going forward; it simply means Congress has to be brought on board. Trump has indicated he has a backup plan to reintroduce the measures, and administration officials have assured him of alternative implementation methods.
The IEEPA law allows the president to take economic measures during declared national emergencies, but the court ruled it does not authorize the president to impose tariffs. The decision is seen as a win for the rule of law and a check on executive power.
The ruling could have significant implications for global trade, with the European Union and Canada welcoming the decision. The US government may have to refund around $175 billion in tariffs collected without congressional authorization.
Trump’s tariffs had been challenged by small importing businesses and 12 Democratic-leaning states, arguing he overstepped his powers. The decision is a setback for Trump’s trade policy, but he has vowed to continue using tariffs as a tool for diplomatic pressure and negotiations.
The Supreme Court’s decision is a significant moment in the ongoing debate over executive power and trade policy. As the US government navigates the implications of the ruling, businesses and investors will be watching closely for the next moves.
