Could This Week’s Court Case Challenge Trump’s Tariffs? Explore the Legal Battle That Might Transform His Trade Strategy | CNN Business

For months, President Trump has been raising tariffs on imports from many countries, using emergency powers to do so. However, a recent court case could challenge those tariffs.

Oral arguments are set for Thursday regarding an appeal from five small business owners and 12 Democratic states. They argue that Trump has overstepped his authority by using the International Emergency Economic Powers Act of 1977 to impose these tariffs.

In May, the U.S. Court of International Trade sided with the plaintiffs, declaring Trump’s actions questionable. But the appeals court allowed the tariffs to stay in place while the case unfolds, which could take weeks or even months.

The decision from the appeals court might reshape Trump’s trade strategy, although it won’t necessarily prevent him from imposing higher tariffs. Trump has relied heavily on the IEEPA, applying various tariffs, including a 10% tariff on most exports to the U.S. since April, as well as targeted tariffs on imports from countries like China, Mexico, and Canada to address issues like drug trafficking.

Recently, he increased tariffs on Brazilian exports by a substantial 40%. He has plans to do more, sticking to a self-imposed deadline for trade agreements. Even countries that reached agreements with him, like Japan and the EU, will face higher tariffs compared to earlier rates.

Legal experts suggest that if the court rules against Trump, the future of these trade agreements may become uncertain. Patrick Childress, an international trade attorney, believes the administration may explore other legal avenues to support those agreements despite any unfavorable court ruling.

Brent Skorup from the Cato Institute notes that countries may hesitate to provoke the administration by reopening negotiations, which carries its own risks. Recently, economists at JPMorgan voiced concerns, stating that if the IEEPA is dismissed, it could raise questions about the legality of the trade deals themselves.

Trump sees tariffs as a key aspect of his economic policy, and this approach is unlikely to change soon. He has relied on various laws, including Section 232 of the Trade Expansion Act of 1962, allowing him to impose tariffs for national security reasons. This authority requires investigations into specific sectors before imposing tariffs.

Additionally, Trump has utilized Section 301 of the Trade Act of 1974 to address potential violations of trade agreements, especially with China. It allows investigations into practices that may harm U.S. businesses.

In total, Trump has many options to continue raising tariffs, many of which are not facing legal challenges. The outcome of this court case could lead to major shifts in U.S. trade policy, making it essential to watch how it develops.

For more on the implications of tariff policies, you can check out an insightful article from the Brookings Institution.

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