U.S. Supreme Court Rules IEEPA Does Not Authorize Presidential Tariffs in Learning Resources, Inc. v. Trump

On 20/02/2026, the Supreme Court of the United States ruled 6–3 in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs, concluding that the statute’s authority to “regulate” international economic transactions does not extend to taxing or raising revenue. The case arose from challenges to a series of tariffs imposed under IEEPA during the Trump administration. In its majority opinion, the Court held that while IEEPA grants the President broad authority to regulate economic transactions during a declared national emergency, it does not explicitly confer the power to levy tariffs. The majority emphasized that the Constitution assigns the power to lay and collect taxes to Congress. Applying the “major questions doctrine,” the Court determined that such expansive economic authority, affecting large portions of U.S. trade, requires clear and unmistakable congressional authorization. Chief Justice John Roberts joined Justices Sonia Sotomayor, Elena Kagan, Neil Gorsuch, Amy Coney Barrett, and Ketanji Brown Jackson in the majority. Justices Clarence Thomas, Samuel Alito, and Brett Kavanaugh dissented. The ruling invalidated a substantial portion of the administration’s tariff framework enacted under IEEPA, including major duties targeting imports from Canada, Mexico, and China. According to filings and court discussions, the affected measures accounted for roughly 70% of the tariff architecture that had been justified under emergency powers. In response to the decision, President Donald Trump invoked Section 122 of the Trade Act of 1974 to impose new, temporary global tariffs. Section 122 allows the President to address balance-of-payments deficits and certain monetary issues through limited-duration trade measures, subject to statutory constraints. Meanwhile, importers affected by the invalidated IEEPA tariffs became eligible to seek refunds for duties deemed unlawful by the Court’s decision, potentially involving substantial sums depending on the volume and duration of prior collections. The ruling did not affect tariffs imposed under Section 232 of the Trade Expansion Act of 1962, which authorizes trade restrictions based on national security determinations. As a result, existing Section 232 tariffs on steel and aluminum remained in force. In the immediate aftermath of the decision, the average U.S. effective tariff rate temporarily declined before new measures under alternative statutory authority were enacted. The decision clarified the limits of executive authority under IEEPA and reinforced Congress’s constitutional role in taxation and trade policy, while leaving intact other statutory pathways for trade restrictions.