A U.S. trade court has ruled that President Donald Trump’s temporary 10% global tariffs, imposed under Section 122 of the Trade Act of 1974, were not legally justified. However, the court limited its decision to only two private importers — toy company Basic Fun! and spice importer Burlap & Barrel — along with the State of Washington, allowing the tariffs to remain in effect for all other importers while appeals continue. The ruling marks another legal setback for Trump’s broader tariff agenda ahead of his expected trade discussions with Chinese President Xi Jinping.
The U.S. Court of International Trade found that the administration had wrongly used Section 122, a law designed to address severe balance-of-payments crises or protect the dollar from sudden depreciation. Trump’s administration argued that the U.S. goods trade deficit and current account deficit justified the tariffs, but economists and legal experts disputed that claim. The court also rejected a request from 24 mostly Democratic-led states seeking a nationwide injunction, stating they lacked standing because most were not direct importers affected by the tariffs.
Despite the ruling, the Trump administration is expected to appeal and continue pursuing broader tariffs through Section 301 of the Trade Act of 1974, which targets unfair trade practices. Trade experts believe new permanent tariffs could emerge later this year under that authority. Meanwhile, businesses affected by the tariffs may file additional lawsuits seeking refunds, potentially setting up another lengthy legal battle over U.S. trade policy and presidential tariff powers.
Pic Courtesy: google/ images are subject to copyright
