American Tariff Chaos
Despite being seemingly predictable, the world was shaken by the decision of the Supreme Court of Justice of the United States last week, which declared illegal the massive tariff increases that Trump introduced unilaterally and arbitrarily starting in April 2025. According to the Supreme Court, the legal basis Trump used to apply these tariffs, the 1977 International Emergency Economic Powers Act (IEEPA), does not contemplate the use of tariff taxes by the President of the Republic, as this authority belongs to the American National Congress.
TL;DR
- The US Supreme Court declared Trump's massive tariff increases illegal, deeming them an overreach of presidential power and a violation of the IEEPA.
- The court's decision necessitates the return of collected tariffs to importers and consumers, a process for which procedures are unclear.
- In response, Trump immediately implemented a temporary 15% tariff on all imported products under Section 122 of the Trade Act to address balance of payments issues.
- This new tariff is temporary (150 days) and faces low prospects of congressional extension due to upcoming elections.
- The tariff chaos has led to increased uncertainty for businesses, potential legal challenges, and strained relations with major trading partners like the EU and Canada.
- The article suggests that this unpredictability erodes the stability and predictability required for global trade, potentially slowing investments and tightening supply chains.