The U.S. Supreme Court justices delivered pointed scrutiny to President Donald Trump's use of tariffs during oral arguments on Wednesday, raising fundamental questions about the limits of executive power under a 1977 law.
Representing the administration, U.S. Solicitor General John Sauer faced intense questioning from both conservative and liberal justices over whether the International Emergency Economic Powers Act (IEEPA) authorizes the president to impose sweeping tariffs unilaterally.
The case stems from challenges by 12 states and private businesses against tariffs invoked to address trade deficits, drug trafficking, and other declared emergencies.
Trump first activated IEEPA in February to levy taxes on goods from China, Mexico, and Canada, citing drug trafficking as a national crisis.
In April, he expanded the measures, imposing levies from 10% to 50% on imports from nearly every country worldwide, framing the U.S. trade deficit as an extraordinary threat.
These actions have generated an estimated $89 billion in revenue between February and September, according to U.S. Customs and Border Protection data.
Central to the dispute is the constitutional allocation of powers, with Article I explicitly granting Congress authority over taxes and tariffs.
Chief Justice John Roberts emphasized this point, noting that the imposition of taxes on Americans has always been a core congressional power.
He questioned Sauer on the breadth of the claimed authority, stating, "The justification is being used for power to impose tariffs on any product from any country in any amount, for any length of time."
Justice Neil Gorsuch expressed similar concerns, asking what would prevent Congress from abdicating its responsibility to regulate foreign commerce.
Joined by Justice Amy Coney Barrett, these conservative voices highlighted potential violations of the court's major questions doctrine, which demands clear congressional authorization for actions of vast economic significance.
Liberal justices, including Elena Kagan and Ketanji Brown Jackson, argued that IEEPA was designed to constrain, not expand, presidential emergency powers.
Kagan described taxation and foreign commerce regulation as quintessential congressional domains, while Jackson underscored the law's intent to limit executive overreach.
Sauer countered that the tariffs serve to regulate trade amid crises that are "country-killing and not sustainable," warning of ruthless retaliation and ruinous consequences if curtailed.
The tariffs, already in partial effect this summer as the U.S. negotiates trade deals, affect an estimated $90 billion in import taxes paid through September — roughly half of this year's tariff revenue.
A ruling against the administration could upend these collections, potentially swelling to $1 trillion if delayed until June, per administration warnings.
Justice Barrett raised practical challenges, pondering whether reimbursing affected parties would create a "complete mess."
Neal Katyal, arguing for the challengers, deemed it implausible that Congress intended IEEPA to overhaul the entire tariff system and economy.
He suggested that while embargoes or quotas might fit the law, revenue-raising tariffs exceed its scope.
Sauer maintained that any revenue is incidental to trade regulation, rooted in the president's broad national security and foreign policy powers.
Lower courts had already struck down the tariffs, finding them unauthorized under IEEPA and the major questions doctrine.
The administration appeals to the 6-3 conservative majority, viewing this as a critical test of Trump's aggressive expansion of executive authority.
Press Secretary Karoline Leavitt indicated preparations for alternative legal avenues if the court rules adversely, stating, "The White House is always preparing for Plan B."
A swift decision is sought, given the global trade war ignited by these measures, which have alienated partners and heightened economic volatility.