WASHINGTON – The Supreme Court will decide the fate of worldwide tariffs President Donald Trump has used to raise revenue, spur manufacturing and exert political pressure on other countries.
The tariffs, the centerpiece of Trump's economic agenda, are also the first major test of his aggressive assertion of presidential powers to fully reach the high court.
The court on Sept. 9 agreed to hear Trump’s appeal of lower court rulings that he overstepped when he invoked a 1977 law to impose tariffs on imports from most of the world's countries.
The court, which has a 6-3 conservative majority, also agreed to fast-track the appeal.
The justices will hear arguments in early November.
Curtis A. Bradley, an expert on foreign relations law at the University of Chicago Law School, said the case sets up a clash between the high court's usual deference to presidents on foreign affairs and its concern about the executive branch claiming authority it wasn't clearly given by Congress.
“It could end up being maybe the biggest blockbuster case of the term in terms of presidential power," Bradley said.
And it could result in the U.S. having to refund at least tens of billions − if not hundreds of billions − of dollars in taxes on imports.
Trump has said the United States faces an "economic disaster" unless the tariffs remain in place.
"If we don't have it, we're not going to have a country. We're going to be in very, very serious financial trouble,” he said Sept. 2.
Still, small businesses and states challenging the tariffs say they have hurt U.S. companies that rely on imports, raised prices for consumers and sparked uncertainty for Americans.
"Repeated decisions by the lower courts have not dissuaded the government from imposing the unilateral tariffs that work these harsh consequences," lawyers for the some of the challengers told the Supreme Court. "This Court’s review is thus essential, and its final word is needed urgently."
Trump is trying to use the International Emergency Economic Powers Act, a law historically used for imposing economic sanctions and other penalties on foreign enemies.
While the law doesn’t mention tariffs, the administration has pointed to the president’s power under the law to “regulate” imports in a crisis. Trump says the nation’s persistent trade deficit and the flow of fentanyl into the United States qualifies as such an emergency.
In a 7-4 decision, the U.S. Court of Appeals for the Federal Circuit said it seemed unlikely that Congress intended to give presidents unlimited authority to impose tariffs.
"The statute bestows significant authority on the President to undertake a number of actions in response to a declared national emergency, but none of these actions explicitly include the power to impose tariffs, duties, or the like, or the power to tax," the court said in its Aug. 29 decision.
In a separate challenge brought by two Illinois toy importers, a different federal court likewise said the tariffs exceeded the president’s powers.
The lower courts' decisions do not impact tariffs issued under other legal authority, such as Trump's tariffs on steel and aluminum imports.
And Treasury Secretary Scott Bessent has said the administration has other ways to tax imports if the Supreme Court says he can't use the International Emergency Economic Powers Act. But the United States would have to send refunds to countries around the world in the meantime which, Bessent said, "would be terrible for the treasury."
The United States has already collected tens of billions of dollars in tariffs. That could increase to as much as $1 trillion by next June, Bessent said in a declaration filed with the Supreme Court.
"The longer a final ruling is delayed," he said, "the greater the risk of economic disruption."
The high court often releases its biggest decisions in June. But the justices' willingness to fast-track the case suggests it will rule sooner on the legality of the tariffs.
This article originally appeared on USA TODAY: Supreme Court to decide fate of Trump's worldwide tariffs
Reporting by Maureen Groppe, USA TODAY / USA TODAY
USA TODAY Network via Reuters Connect