Supreme Court Rules President Lacks IEEPA Authority To Impose Tariffs

Key Takeaways

• The Supreme Court ruled that IEEPA does not authorize the President to impose tariffs; clear congressional authorization is required.
• Today's decision does not affect existing tariffs imposed under other trade statutes such as Section 232 and Section 301.
• Importers should consult with legal counsel and make a plan for protecting potential refund rights.

On Feb. 20, 2026, the U.S. Supreme Court issued a landmark decision limiting presidential authority over U.S. trade policy, holding that the International Emergency Economic Powers Act (IEEPA) does not give the president unilateral authority to impose tariffs. In a 6–3 ruling, the Court concluded that Congress did not delegate general tariff‑setting power through IEEPA and that the constitutional authority to impose duties remains vested in Congress under Article I, Section 8.

The Court's decision turned on the text and structure of IEEPA and the broader statutory landscape governing trade. While Congress has, on multiple occasions, expressly delegated conditional tariff authority to the president – most notably under Section 232 of the Trade Expansion Act of 1962 for national security concerns and Sections 122 and 301 of the Trade Act of 1974 for balance‑of‑payments and unfair trade practices – IEEPA contains no reference to tariffs or duties. The Court rejected the government's argument that the statute's authorization to “regulate” imports implicitly includes the power to impose revenue‑raising tariffs, emphasizing that Congress has historically spoken clearly when delegating such economically significant authority.

The decision resolves consolidated challenges to the IEEPA tariffs brought in Learning Resources, Inc. v. Trump and V.O.S. Selections, Inc. v. Trump. In those cases, small businesses and several states argued that the tariffs – initially imposed in February 2025 on imports from China, Canada and Mexico and later expanded to most U.S. trading partners – were unlawful. Lower courts agreed, and the Supreme Court affirmed their rulings. The tariffs, which were justified by declared national emergencies related to drug trafficking and trade deficits, generated well over $100 billion in estimated duty deposits before being invalidated.

Although the Court resolved the question of authority, it did not address the scope or mechanics of remedies. The majority opinion is silent on how refunds should be administered or which procedural avenues importers must use to recover duties already paid. The dissent, however, warned that the decision could require the federal government to refund billions of dollars and suggested that the refund process is likely to be complex.

The practical impact of the decision will depend heavily on the liquidation status of affected entries. A substantial number of imports subject to the IEEPA tariffs remain unliquidated, meaning that Customs and Border Protection (CBP) may be required to liquidate those entries without the IEEPA tariffs and refund estimated duties paid. Importers also may consider filing Post-Summary Corrections excluding the IEEPA tariffs for unliquidated entries. For entries that already have been liquidated, importers may need to pursue administrative protests with CBP or seek judicial relief in the U.S. Court of International Trade. The government has previously stated in litigation that it would issue refunds if the IEEPA tariffs were invalidated, but no formal refund framework has yet been announced. We hope to see further guidance from CBP and the Department of the Treasury soon.

Importantly, the Supreme Court's ruling is limited to tariffs imposed under IEEPA. Other tariff programs, including product‑specific national security tariffs imposed under Section 232 of the Trade Expansion Act of 1962 and tariffs imposed under Section 301 of the Trade Act of 1974 for unfair foreign trade practices, were not at issue and remain in effect unless separately challenged or modified.

In practical terms, the decision reaffirms that tariff authority must be expressly delegated by Congress and signals heightened judicial scrutiny of expansive assertions of emergency economic power. Importers affected by the IEEPA tariffs should evaluate their exposure based on entry liquidation status and make a plan to preserve potential refund rights as the government develops implementation guidance.

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