Legal Battle Over Trump’s 'Reciprocal Tariffs' Heads to Supreme Court, Final Ruling Expected This Year

U.S. Supreme Court Agrees to Expedited Review
Written Briefs Due by the 19th
First Oral Arguments Scheduled for Early November
Key Issue: Interpretation of Presidential Authority Under the IEEPA

The final ruling of the U.S. Supreme Court on the legality of the "reciprocal tariffs" imposed worldwide by President Donald Trump is expected to be delivered within this year. This decision is anticipated to have a significant impact not only on the future direction of U.S. trade policy but also on the overall framework of trade negotiations led by the United States.

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On September 9 (local time), the Supreme Court agreed to hear the reciprocal tariffs lawsuit and accepted the Trump administration's request for an expedited process. As a result, the Trump administration must submit a written opinion by the 19th, and the first oral arguments are scheduled for the first week of November. According to this timeline, a ruling within the year is possible, The Wall Street Journal (WSJ) reported.

Previously, in May, the U.S. Court of International Trade ruled that the tariffs imposed by the Trump administration based on the International Emergency Economic Powers Act (IEEPA) were illegal. On August 29, the U.S. Court of Appeals for the Federal Circuit also recognized the abuse of presidential authority in a 7-to-4 decision, stating that "the IEEPA, enacted in 1977, does not grant the president the authority to impose tariffs." The Trump administration, dissatisfied with the ruling, appealed to the Supreme Court for a swift review, arguing that delays in the litigation would disrupt ongoing tariff negotiations with other countries.

This lawsuit is expected to be the first case in which the Supreme Court will make a substantive judgment on the legality of a major policy pushed by the Trump administration during its second term. Since taking office, President Trump has faced numerous lawsuits over various policies, but until now, the Supreme Court has only intervened to allow or block temporary measures. During this process, the Trump administration has won emergency Supreme Court reviews on issues such as the repeal of the Deferred Action for Childhood Arrivals (DACA), the dismissal of federal agency heads, and the suspension of subsidies.

The central issue of the lawsuit is whether the president can impose reciprocal tariffs worldwide based on the IEEPA. The IEEPA has primarily been used as a tool for sanctioning adversarial nations or freezing assets, and President Trump is the first to use it as a basis for tariffs. Accordingly, this lawsuit is seen as a critical juncture that will determine the direction of the Trump administration's trade policy, as tariffs are a key pillar of the second-term trade agenda. President Trump has argued that tariffs will help block the fentanyl crisis, revive manufacturing, and protect jobs.

The Washington Post (WP) analyzed, "This lawsuit could determine the core of the president's economic agenda and is considered a significant event that could fundamentally change the flow of the U.S. economy and global trade." Reuters also assessed, "This case will be a critical legal crossroads that tests the president's economic authority."

If the Trump administration loses in the Supreme Court, the reciprocal tariff policy will lose its legal basis. Although the appeals court already ruled that there was no authority to impose tariffs, the effect of that ruling was suspended during the Supreme Court's review, allowing the tariffs to remain in place. However, the Supreme Court's final ruling constitutes the judiciary's ultimate decision, which the administration must respect and implement. In this case, up to 1 trillion dollars in collected tariffs may have to be refunded, and some trade agreements concluded with approximately 12 countries and the European Union (EU) could be reversed.

The Trump administration has warned that such an outcome would trigger "catastrophic repercussions." Treasury Secretary Scott Besant argued in documents submitted to the Supreme Court that "tariff revenues of 750 billion to 1 trillion dollars are expected by next summer, and if the court invalidates the tariffs, the economic damage will be devastating."

There are also projections that, in preparation for a loss, the Trump administration could utilize other laws such as Section 232 of the Trade Expansion Act or Section 301 of the Trade Act. However, this would require significant time due to procedures such as initiating investigations, submitting reports, holding public hearings under the Administrative Procedure Act (APA), and publishing notices in the Federal Register. In fact, during the first Trump administration, it took an average of 7 to 11 months to impose steel and aluminum tariffs (Section 232) and tariffs on Chinese imports (Section 301).

The Washington Post reported, "Even if President Trump loses in the Supreme Court, he could reimpose tariffs using other legal means," but added, "delays are inevitable due to required administrative procedures. The administration is reportedly reviewing such alternative routes as well."

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