Supreme Court justices question Trump's authority for sweeping tariffs

US Supreme Court justices seemed skeptical during Nov. 5 oral arguments as to whether President Donald Trump acted within his powers to impose sweeping tariffs on nearly all US trading partners.

The high court took up the Trump administration's appeal of a lower court ruling that found Trump had exceeded his authority to implement tariffs, which were challenged by several businesses and 12 states.

Arguments centered on whether the International Emergency Economic Powers Act of 1977, or IEEPA, allows a president to impose tariffs during a declared national emergency. Trump invoked IEEPA to implement country-specific tariffs as well as higher rates on Chinese-specific goods.

Trump has used tariffs as his primary foreign policy lever, striking deals with diverse nations, gaining promises of investments in the US in exchange for lowered tariff rates. Trump's tariffs have rewired global trade agreements and driven up costs for US consumers. Striking them down could have wide-ranging implications.

Multiple justices sounded doubtful about Trump's broad application of the law.

"You have a claimed source in IEEPA that had never before been used to justify tariffs," Chief Justice John Roberts told the government's attorney. "No one has argued that it does until this particular case. Congress uses tariffs in other provisions, but not here and yet ... the justification is being used for a power to impose tariffs on any product from any country in any amount for any length of time ... but it does seem like that's major authority and the basis for the claim seems to be a misfit."

Justices debated the nuanced language of IEEPA, posed questions as to whether Congress has the exclusive authority to levy taxes and argued over the history of the 1970s-based trade law. Several expressed concerns that supporting Trump's tariffs would lead to unlimited presidential authority that could not be reined in by Congress.

The court took this case on an expedited basis at the behest of the administration, and while it would traditionally take some months to reach a decision, it could opine early.

Justices debate IEEPA language

Justice Elena Kagan said IEEPA does not provide that a president can raise revenue or taxing power. She listed the actions included in the law and told Trump's attorney John Sauer the legislation"doesn't have the one you want."

Roberts pointed to how IEEPA has never been used to justify tariffs. No president has used IEEPA to impose tariffs since the law was enacted in 1977, according to a Congressional Research Service report.

IEEPA's language authorizes a president to "regulate importation or exportation," "to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States" and "if the president declares a national emergency."

"This is an open-ended power," said Neal Katyal, the attorney representing the group of small businesses.

Katyal argued that the language in IEEPA does not specifically list "tariff" as an action that can be implemented following the declaration of an emergency. If this was the intention, the law would explicitly use the wording, he said, listing several other statutes as examples where "tariff" is specifically mentioned.

The Trump administration argued that the sweeping language in IEEPA provides the backing for Trump's actions.

"The phrase 'regulate importation' plainly embraces tariffs," said Sauer, solicitor general with the Justice Department.

Questions raised over congressional power

The major questions doctrine saysfederal agencies must have explicit authorization from Congress to implement certain regulations of "economic and political significance."

The Trump administration argued that the doctrine does not apply to this case. Sauer said one would expect Congress to confer major powers to the president when addressing foreign international crises.

Justice Neil Gorsuch asked if Congress could hand off legislating business to a president if there is an inherent presidential authority to regulate commerce and introduce tariffs.

"What would stop Congress from doing that?" he asked.

Justice Sonia Sotomayor asked how a declared emergency can remove the major questions doctrine, referencing similar declared emergencies where policy was overturned under former President Joe Biden.

The high court previously ruled that Congress must have a say in economic and politically significant actions, ruling against Biden-era policies during the coronavirus pandemic related to student loans and climate change.

Justices raise concerns over expanding presidential power

Several justices questioned how the outcome of this case could impact future presidential power if executive authority is expanded as a result of the court's decision.

Sotomayor said the Constitution is structured so that if a citizen is asked to pay for something, it's through a bill generated by Congress.

She said that the case is not just the taxing power, but whether the court permits the president to use the taxing power "to affect his personal choices of what is good policy for me to pay for."

IEEPA was designed to limit presidential authority from when it was first implemented, Justice Ketanji Brown Jackson said. It is inconsistent to interpret statutes differently for legislation that intended to rein in power, she added.

Katyal stressed that supporting Trump's tariffs would lead down a path of expanded presidential power that Congress would not be able to rein in.

"This is a one-way ratchet. We will never get this power back if the government wins this case," Katyal said.

Sauer pointed to one other example of a former president implementing tariffs using similar legislation. President Richard Nixon imposed a 10% temporary tariff in 1971 using the Trading with the Enemy Act, the predecessor to IEEPA. Lower courts opined that IEEPA was written explicitly to curb the kind of authority Nixon claimed for himself.

Reimbursement process would be 'complicated'

Justices also raised concerns about the consequences of overturning the tariffs. Lower courts have declined to enjoin the collection of duties under the tariffs, and if Trump's authority is unconstitutional, then importers would be due for reimbursements.

Justice Amy Coney Barrett asked Katyal about the reimbursement process if the small businesses win the case.

Katyal described it as a "very complicated thing."

"So a mess?" Kagan asked.