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What You Need to Know
Key takeaway #1
IEEPA Tariffs Blocked: The Supreme Court ruled that President Trump cannot impose tariffs under the International Emergency Economic Powers Act (IEEPA).
Key takeaway #2
Potential for Refunds: Retailers exposed to tariffs should assess their eligibility for refunds, though the process is expected to be lengthy and contested by the Administration.
Key takeaway #3
More Predictability Ahead: The scope of presidential authority for imposing tariffs is now more limited, which may allow retailers to better plan for sourcing, pricing, and inventory.
Key takeaway #4
Ongoing Tariff Uncertainty: Despite the ruling, President Trump plans to continue imposing tariffs using other statutes such as Section 122 and Section 232.
Key takeaway #5
Legal and Legislative Challenges: Future tariffs are likely to face legal challenges, but Congress is not expected to act meaningfully before the midterm elections, leaving continued uncertainty for retailers.
The Supreme Court has concluded that the International Emergency Economic Powers Act (IEEPA) does not authorize President Trump to impose tariffs. For a detailed analysis of the decision, please see our Trade Group's full alert.
Below is what this means for the retail sector:
- Refunds. Importers should take affirmative steps to preserve rights to refunds, including filing suit in the CIT, monitoring CBP liquidation of entries, and making appropriate administrative challenges. We anticipate the Administration will resist paying refunds, and the process may take some time. But, retailers with significant tariff exposure should evaluate potential claims now. Nothing ventured, nothing gained.
- Some Certainty. The decision has curtailed President Trump's authority to impose tariffs. However, there are other statutes we expect he will continue to invoke (and already has in the few days since the decision). His authority under those statutes is more constrained and might allow for some predictability for retailers' planning, sourcing, pricing, and inventory strategies.
- But Maybe Nothing Else. President Trump has vowed to continue imposing tariffs. He announced a 15% global tariff on all imports under section 122, effective Monday, February 23, 2026, reaffirming all existing section 232 (product) and section 301 (unfair trade practices) tariffs, and announced the Administration will launch new tariff investigations.
Certainly Uncertainty. How the Administration will justify ongoing tariffs — and how aggressively it will deploy them — is likely to trigger legal challenges. For example, The Trade Expansion Act of 1962, Section 232, allows tariff to be imposed, but there must be a threat or impairment of national security. The Trade Act of 1974, Section 122, authorizes tariffs for a 150-days when there are "large and serious" balance-of-payments deficits. Congress ultimately has the authority to curtain the President's ability to impose tariffs. However, meaningful legislative action appears unlikely in the near term, at least not before the midterm elections.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
