Supreme Court: President Can’t Use IEEPA to Impose Tariffs

The Supreme Court ruled 6-3 on Feb. 20, 2026, in Learning Resources, Inc. v. Trump that the International Emergency Economic Powers Act does not authorize the president to impose tariffs. The decision voided billions of dollars in duties on imports from Canada, Mexico, China and other countries and identified about $175 billion in duties that could be eligible for refunds.

IEEPA allows a president to regulate economic transactions after declaring a national emergency. The court’s majority held that the Constitution gives Congress the power to levy taxes, including tariffs, and that IEEPA does not delegate that tax power to the executive branch.

The lawsuit was filed by Learning Resources and other small businesses, along with 24 states. The administration has filed appeals in response to the ruling.

After the decision, the administration imposed new global tariffs under Section 122 of the Trade Act of 1974, first at 10 percent and later at 15 percent. Section 122 authorizes temporary tariffs when the United States faces a balance-of-payments deficit. A federal judge at the U.S. Court of International Trade struck down the Section 122 tariffs, finding the administration had not provided sufficient evidence to justify a balance-of-payments emergency. The administration has appealed that ruling as well.

The $175 billion figure refers to duties already collected under the tariffs the court found unauthorized. If courts and U.S. Customs finalize refunds, importers who paid those duties could seek reimbursement through the legal and administrative processes that apply to tariff refunds.

Multiple appeals remain pending in the courts. Congress could adopt tariff measures by statute; such legislation would require committee consideration, floor votes and agreement in both chambers of Congress.

In its opinion, the court drew a legal line between emergency economic controls available under IEEPA and the separate constitutional authority to tax and impose tariffs. The ruling limits the tools the executive branch may use to address trade and supply-chain issues unless Congress provides a statutory basis for tariffs.