In a landmark 6-3 ruling, the US Supreme Court declared unlawful the special tariffs President Donald Trump imposed on dozens of trading partners under a 1977 emergency law, ruling that it does not authorize the president to bypass Congress. The decision, published earlier this year, has collected about $130 billion but left refunds unclear, prompting lawsuits from importers like FedEx. Trump responded by announcing a new general 10% tariff on all goods.
President Trump invoked the 1977 emergency provision to impose reciprocal tariffs starting April 2025, bypassing congressional approval. The Supreme Court's 170-page opinion held these actions invalid, though base tariffs, steel, aluminum, and auto duties remain intact. Average US tariffs dropped from 17% to 9.1% per Yale Budget Lab estimates.
Trump called the verdict 'severely disappointing' in an online post, expressing shame for some justices, and at a press conference unveiled plans for a 10% base tariff on all imports. The court did not rule on refunds for the $130 billion collected, leaving it to Congress or lower courts, potentially causing chaos.
Importers including US logistics giant FedEx have filed suits at the New York Court of International Trade seeking repayment of paid duties.
The ruling brings short-term relief to exporters like Germany's, with initial drops in export costs to the US, though uncertainty lingers from potential product-specific tariffs. Ifo Institute head Clemens Fuest hailed it as upholding checks and balances but cautioned on volatility. The EU Commission is reviewing it to push for low tariffs. Economists such as Yale's Penny Goldberg note limited direct effects but high uncertainty costs; Morgan Stanley predicts 0.2% GDP boost if 80% refunds occur.
German energy firm RWE highlighted indirect impacts: CEO Markus Krebber told Politico that US tariffs disrupt new project investments but not operations post-construction, as electricity is local. RWE launched a share buyback program nearly a year ago to address US delays after Trump halted wind and solar expansions.
