Can't say one way or another whether the power of the president was abused in this case but its a sad state for businesses who can't get started because of flip flopping policy. I'm for the tarrifs, its absolutely ridiculous to think only Wall Street matters.
I love how it’s “global damage” when the US tariffs counties that are already tariffing them. But no, unfortunately the rest of the world knows the US’s value.
Is it all speculation still at this point for what happens next? Like are they immediately void, does the govt have to repay importers the now illegal loss?
Or is this just another "trump did illegal thing but nothing will happen" kind of scenario?
Unfortunately, I suspect that many platforms/outlets which were paying tariffs for us will continue their high prices. I’d love to see my startups cost of hardware go down but I can’t plan on it happening in my CapEx projections.
This ruling impacts tariffs imposed by way of the International Emergency Economic Powers Act, which includes the reciprocal tariffs announced on April 2’s so-called “Liberation Day.” Bloomberg Intelligence estimates that roughly $170 billion in tariff revenues have been generated through February 20 via these policies. However, this ruling has no bearing on section 232 tariffs, which have been used to justify levies on the likes of steel and aluminum.
Trump administration officials had indicated that they developed contingency plans to attempt to reinstate levies in the event of this outcome. CNN reported that Trump called this ruling a “disgrace” and said he had a backup plan for tariffs.
All of that pain for nothing. The Trump administration's signature policy achievements involve the DJT ticker and actual meme coins. I hope no republican sits in the oval office for 50 years, they're all responsible for enabling this madness and self-destruction.
Howard Lutnick and his sons are surely happy about this. It’s almost like Howard Lutnick, the Secretary of Commerce, knew this would happen. His sons, at their firm Cantor Fitzgerald, have been offering a tariff refund product wherein they pay companies who are struggling with paying tariffs 20-30% of a potential refund, and if (as they did today) they get struck down, they pocket the 100% refund.
> a tariff refund product wherein they pay companies who are struggling with paying tariffs 20-30% of a potential refund
For what it’s worth, I’ve personally been doing this. Not in meaningful dollar amounts. And largely to help regional businesses stay afloat. But I paid their tariffs and bought, in return, a limited power of attorney and claim to any refunds.
There's no scam too big or too small, from Trumpcoin's open bribery, to Secret Service paying 5x the GSA per diem rate to stay at Trump properties on duty.
Meanwhile Pam Bondi's brother is a lawyer who's firm represents clients with cases against the justice department, and those cases keep getting dropped.
He is also surely happy the Trump administration no longer sees fit to investigate or pursue anyone with connections to Epstein. Previously Lutnick had lied about the extent of their relationship, yet even after the recent relevations he can simply wave them off.
What a profitable time for the Lutnicks, who are of course already fabulously wealthy. Our system really does reward the best people.
If the court establishes that this was a tax, how would they administer the refund considering it's impossible to disentangle absorbed tariffs by firms and those passed along to consumers?
Can I get compensation from UPS or FedEx for making me pay illegal tariffs - and making me pay a fee to them for processing it too?
(I know the answer is practically ’no’, but it does still seem to me that the bureaucracy and companies that went along with this obviously illegal operation bear some culpability...)
Sometimes the consumer (more) directly pays when buying from overseas, most of the time you're right it gets rolled into the price at checkout if the company is large enough or just in larger prices buying in the US. I've had a few packages I had to pay extra import duties on with the UPS/FedEx agent fees tacked on top mostly kickstarters.
When I have bought things internationally, I have always been the one doing the importing. This means I paid some Trump taxes and I will get my money back.
In October, I bought a $250 product from a Canadian company + about $30 shipping & taxes and thought I was good. A few weeks later, FedEx sends me an $92 bill for the duty that they had to pay. I just ignored it since I was never given that notice up front. If they really wanted it, they could have had the vendor contact me. But at least they're not getting that bit of profit now.
I think people are getting ahead of themselves on the refund business. Refunds might be on the table, they also may not be. It may be a years long battle. Trump and co might put up enough resistance that many firms find it too costly to fight.
This will be so in some cases, but there are extra steps in others.
e.g. In a different path, 1 and 2 are the same, but things then diverge.
3) To recoup some of those tariff costs, the company sells the rights to any potential future tariff refunds. They recoup a portion of what they paid immediately but hand away the right to a full refund to another party, such as Cantor Fitzgerald. The seller might use this to reduce prices for their customers, but probably won't. They'll set prices according to what the market will support.
4) US government will refund all/most of that tax back to companies, like Cantor Fitzgerald, that bought the rights to tariff refunds.
5) Seller doesn't get any extra money back, so there's no money to refund to consumers.
IMPORTANT NOTE: Cantor Fitzgerald, while just one of the companies doing this, was formerly headed by Howard Lutnick and is currently owned and operated by his sons.
To the extent this is true, the entire thing could literally be a grift (I'm not saying Trump is smart enough to come up with this, just that people around him are, and he's grifty enough to go along with it):
1. Trump enacts the tariff, despite knowing it will be struck down.
2. The tariff extracts hundreds of billions from the economy.
3. Finance firms buy the potential refund for pennies on the dollar, knowing that Trump has no plan to defend the tariff.
4. The Supreme Court strikes down the tariff, as planned.
5. The finance firms profit on the refunds.
6. We are all poorer, Trump's cronies are richer.
Refunds are very complicated. How does the co even know who bought? As it goes thru several layers of distribution chain. Assuming they want to refund of course. I suppose they will claim they reduced prices (or more likely deferred price increases, how nice!)
And then not all tariff was absorbed by importer - some suppliers would have cut prices to compensate wholly or partly. We would never know as it is likely buried in various other discounts and contract terms not a line item that says "for tariff". Down the chain, others with margins could have done the same. That's probably why the inflation impact was less than scary scenarios painted by some economists.
What I think is interesting is if there is going to be a legal distinction between a seller raising their prices 10% for the item itself vs. a seller charging a separate line item for tariffs/customs/duties.
I can see a situation where the courts find that a general price increase is simply they - an offer to sell at a price the buyer accepted regardless of the seller's motivation to increase pricing. However a line item that very clearly states that a charge is for duties paid might be treated differently?
Very curious to see what the legal minds have to say in this scenario. In a way it may punish companies for doing what many to most consumers feel was the "right" thing to do - add a surcharge that can easily be removed if the situation changed in the future vs. using a general increase as a new price anchor.
Seller sold forward contracts to recoup tariffs at a lower price and passed on the benefits to the consumers already. E.g. For every $1 seller paid as tariffs, seller sold a contract to someone for $0.25 saying if government ever refunds the buyer of the contract can keep it. The $0.25 already passed to consumers as benefits.
> Seller gets to keep the returned tax money as pure profit (no refund to customer)
Not to the specific customer but this benefits will now get passed to future customers as prices will be lowered than usual (lower than pre-tariff prices) due to competition.
Note that consumers who paid more were not necessarily paying the tariffs. Stores like Costco, Walmart increased prices across the board and socialized the impact of tariffs. Even if there was some mechanism to return tariff money to consumer, there is no way you could return it to someone who paid higher due to this socialized nature of price increase.
It’s worse. Sellers raised prices citing tariffs. Not only does the seller get a one time bonus, the prices are now permanently raised as we all know prices are never coming down
It’s disappointing but not surprising that the SC left the administration to illegally bilk US taxpayers for billions upon billions of dollars for something that was facially unconstitutional.
They should’ve allowed an emergency injunction from the outset.
Right. Most of the news articles don't link to the decision, which is worth reading.
It's a 6-3 decision. Not close.
Here's the actual decision:
The judgment of the United States Court of Appeals for
the Federal Circuit in case No. 25–250 is affirmed. The
judgment of the United States District Court for the District of Columbia in case No. 24–1287 is vacated, and the
case is remanded with instructions to dismiss for lack of jurisdiction.
So what does that mean in terms of action?
It means this decision [1] is now live. The vacated decision was a stay, and that's now dead.
So the live decision is now: We affirm the CIT’s holding that the Trafficking and
Reciprocal Tariffs imposed by the Challenged Executive Orders exceed the authority delegated to the President by IEEPA’s text. We also affirm the CIT’s grant of declaratory
relief that the orders are “invalid as contrary to law.”
"CIT" is the Court of International Trade. Their judgement [2], which was unanimous, is now live.
It reads:
"The court holds for the foregoing reasons that IEEPA does not authorize any of the
Worldwide, Retaliatory, or Trafficking Tariff Orders. The Worldwide and Retaliatory Tariff
Orders exceed any authority granted to the President by IEEPA to regulate importation by means
of tariffs. The Trafficking Tariffs fail because they do not deal with the threats set forth in those orders. This conclusion entitles Plaintiffs to judgment as a matter of law; as the court further finds no genuine dispute as to any material fact, summary judgment will enter against the United States. See USCIT R. 56. The challenged Tariff Orders will be vacated and their operation permanently enjoined."
So that last line is the current state: "The challenged Tariff Orders will be vacated and their operation permanently enjoined." Immediately, it appears.
A useful question for companies owed a refund is whether they can use their credit against the United States for other debts to the United States, including taxes.
The Gorsuch concurring is quite the read, but wish more Americans internalized its final paragraph (excerpts below).
Yes, legislating can be hard and take time. And, yes, it can be tempting to bypass Congress when some pressing problem arises. But the deliberative nature of the legislative process was the whole point of its design. ...
But if history is any guide, the tables will turn and the day will come when those disappointed by today’s result will appreciate the legislative process for the bulwark of liberty it is.
Hmm, I read some of the decision, and now I'm not sure what to make of all of it.
When I came to the opinion from Jackson, J., I found it extremely compelling. He says this:
... But some of TWEA’s sections delegating this authority had lapsed, and “there [was] doubt as to the effectiveness of other sections.” Accordingly, Congress amended TWEA in 1941, adding the subsection that includes the “regulate ... importation” language on which the President relies today. The Reports explained Congress’s primary purpose for the 1941 amendment: shoring up the President’s ability to control foreign-owned property by maintaining and strengthening the “existing system of foreign property control (commonly known as freezing control).”
When Congress enacted IEEPA in 1977, limiting the circumstances under which the President could exercise his emergency authorities, it kept the “regulate ... importation” language from TWEA. The other two relevant pieces of legislative history—the Senate and House Reports that accompanied IEEPA—demonstrate that Congress’s intent regarding the scope of this statutory language remained the same. As the Senate Report explained, Congress’s sole objective for the “regulate ... importation” subsection was to grant the President the emergency authority “to control or freeze property transactions where a foreign interest is involved.” The House Report likewise described IEEPA as empowering the President to “regulate or freeze any property in which any foreign country or a national thereof has any interest.”
However, then I read Kavanaugh, J. who writes the following:
In 1971, President Nixon imposed 10 percent tariffs on almost all foreign imports. He levied the tariffs under IEEPA’s predecessor statute, the Trading with the Enemy Act (TWEA), which similarly authorized the President to “regulate ... importation.” The Nixon tariffs were upheld in court.
When IEEPA was enacted in 1977 in the wake of the Nixon and Ford tariffs and the Algonquin decision, Congress and the public plainly would have understood that the power to “regulate ... importation” included tariffs. If Congress wanted to exclude tariffs from IEEPA, it surely would not have enacted the same broad “regulate ... importation” language that had just been used to justify major American tariffs on foreign imports.
And I also find this compelling.
To add onto this, Roberts, C. J. says: IEEPA’s grant of authority to “regulate ... importation” falls short. IEEPA contains no reference to tariffs or duties. The Government points to no statute in which Congress used the word “regulate” to authorize taxation. And until now no President has read IEEPA to confer such power.
This seems directly contradictory to Kavanaugh, J.'s dissent! Kavanaugh, J. claims that Nixon used the word “regulate” to impose tarrifs. And apparently the word isn't just in some random other statute — Nixon did so from TWEA, the predecessor of IEEPA: when Congress enacted IEEPA in 1977 it kept the “regulate ... importation” language from TWEA. (from Jackson, J.) So the point that no President has read IEEPA to confer such power seems pretty weak, when Nixon apparently did so from TWEA.
I have no conclusion from this, but IMO both Jackson, J. and Kavanaugh, J. have pretty strong points in opposing directions.
”Based on two words separated by 16 others, the President asserts the independent power to impose tariffs on imports from any country, of any product, at any rate, for any amount of time. Those words cannot bear such weight.”
Zing! Surprisingly spicy writing for such a gravely serious body.
Great news for people who had to bend over backwards pretending this disruptive, nakedly corrupt behavior was "good, actually."
But unfortunately, there are other channels for them to effectively do the same thing, as discussed in oral arguments. So still not a major win for American manufacturers or consumers, I fear.
> Great news for people who had to bend over backwards pretending this disruptive, nakedly corrupt behavior was "good, actually."
Actually they’re still doing it. I saw it not 2 minutes after seeing this post initially. The justifications for why they were “good, actually” has gotten increasingly vague though.
The damage goes far beyond the wallets of business and consumers. The unilateral, arbitrary tariff setting has little do with money and everything to do with the power it gave Trump. And was one of the primary instruments used to destroy relationships with our foreign allies including our closes neighbor..
I wonder what this means for the EU. We made a new deal under pressure of the tariffs that is actually worse than the deal we had. If we had not bent the knee, we would have had that original deal back, or at least, so it seems? Now we seem to be properly shafted due to weak politicians.
179 comments
[ 3.1 ms ] story [ 104 ms ] threadConstitutional changes are required for other countries to trust in the stability of the US in the future.
Or is this just another "trump did illegal thing but nothing will happen" kind of scenario?
Trump administration officials had indicated that they developed contingency plans to attempt to reinstate levies in the event of this outcome. CNN reported that Trump called this ruling a “disgrace” and said he had a backup plan for tariffs.
The man has a lot of cheques to write for the 175 billion he stole illegally from foreign countries.
Always useful to have a grasp on reality.
https://www.finance.senate.gov/ranking-members-news/wyden-wa...
For what it’s worth, I’ve personally been doing this. Not in meaningful dollar amounts. And largely to help regional businesses stay afloat. But I paid their tariffs and bought, in return, a limited power of attorney and claim to any refunds.
- https://www.newsweek.com/trump-doj-handling-pam-bondi-brothe...
- https://abcnews.com/US/doj-drops-charges-client-ag-pam-bondi...
Always seems to be in the right place and the right time
https://archive.is/W6Gqy
[0] https://www.theguardian.com/us-news/2026/jan/30/new-epstein-...
What a profitable time for the Lutnicks, who are of course already fabulously wealthy. Our system really does reward the best people.
Now let's wait for the retaliation of 'Team Orange Dictatorship'
1) US customer pays huge import tax on imported goods in the form of higher prices.
2) Seller sends the collected tax to the US government
3) US government will refund all/most of that tax back to the seller after this ruling
4) Seller gets to keep the returned tax money as pure profit (no refund to customer)
(I know the answer is practically ’no’, but it does still seem to me that the bureaucracy and companies that went along with this obviously illegal operation bear some culpability...)
Elections have consequences.
e.g. In a different path, 1 and 2 are the same, but things then diverge.
3) To recoup some of those tariff costs, the company sells the rights to any potential future tariff refunds. They recoup a portion of what they paid immediately but hand away the right to a full refund to another party, such as Cantor Fitzgerald. The seller might use this to reduce prices for their customers, but probably won't. They'll set prices according to what the market will support.
4) US government will refund all/most of that tax back to companies, like Cantor Fitzgerald, that bought the rights to tariff refunds.
5) Seller doesn't get any extra money back, so there's no money to refund to consumers.
IMPORTANT NOTE: Cantor Fitzgerald, while just one of the companies doing this, was formerly headed by Howard Lutnick and is currently owned and operated by his sons.
The price the market supports depends on things like taxes and tariffs.
Why removing taxes lowers prices:
https://open.substack.com/pub/shonczinner/p/why-removing-tax...
Seller may not reduce the price as well. Thus, continues to keep the raised price due to tariffs as free profit.
And then not all tariff was absorbed by importer - some suppliers would have cut prices to compensate wholly or partly. We would never know as it is likely buried in various other discounts and contract terms not a line item that says "for tariff". Down the chain, others with margins could have done the same. That's probably why the inflation impact was less than scary scenarios painted by some economists.
I can see a situation where the courts find that a general price increase is simply they - an offer to sell at a price the buyer accepted regardless of the seller's motivation to increase pricing. However a line item that very clearly states that a charge is for duties paid might be treated differently?
Very curious to see what the legal minds have to say in this scenario. In a way it may punish companies for doing what many to most consumers feel was the "right" thing to do - add a surcharge that can easily be removed if the situation changed in the future vs. using a general increase as a new price anchor.
Seller sold forward contracts to recoup tariffs at a lower price and passed on the benefits to the consumers already. E.g. For every $1 seller paid as tariffs, seller sold a contract to someone for $0.25 saying if government ever refunds the buyer of the contract can keep it. The $0.25 already passed to consumers as benefits.
> Seller gets to keep the returned tax money as pure profit (no refund to customer)
Not to the specific customer but this benefits will now get passed to future customers as prices will be lowered than usual (lower than pre-tariff prices) due to competition.
Note that consumers who paid more were not necessarily paying the tariffs. Stores like Costco, Walmart increased prices across the board and socialized the impact of tariffs. Even if there was some mechanism to return tariff money to consumer, there is no way you could return it to someone who paid higher due to this socialized nature of price increase.
Not according to the current administration: https://www.youtube.com/shorts/CODFD3j623E
According to them, China and others are paying the tariffs, so any refunds clearly have to go to China...
"Trump says China is paying for his tariffs" - https://www.nbcnews.com/politics/donald-trump/fact-check-tru...
"Trump Incorrectly Has Insisted ‘China’s Paying the Tariffs’" - https://www.nytimes.com/video/us/politics/100000006661985/tr...
"Fact check: Trump and Vance keep falsely describing how tariffs work" - https://edition.cnn.com/2024/09/09/politics/fact-check-trump...
They should’ve allowed an emergency injunction from the outset.
They’re hands off so the president can clearly gather illegal taxes.
Then they change their mind. So what? The government gives the taxes back? Is that even possible?
Next step what? Trump does something else illegal and SCOTUS majority sits on their hands for a year or more?
SCOTUS majority’s deference to their guy has become absurd… the judicial branch is of no use…
It's a 6-3 decision. Not close.
Here's the actual decision:
The judgment of the United States Court of Appeals for the Federal Circuit in case No. 25–250 is affirmed. The judgment of the United States District Court for the District of Columbia in case No. 24–1287 is vacated, and the case is remanded with instructions to dismiss for lack of jurisdiction.
So what does that mean in terms of action?
It means this decision [1] is now live. The vacated decision was a stay, and that's now dead.
So the live decision is now: We affirm the CIT’s holding that the Trafficking and Reciprocal Tariffs imposed by the Challenged Executive Orders exceed the authority delegated to the President by IEEPA’s text. We also affirm the CIT’s grant of declaratory relief that the orders are “invalid as contrary to law.”
"CIT" is the Court of International Trade. Their judgement [2], which was unanimous, is now live. It reads:
"The court holds for the foregoing reasons that IEEPA does not authorize any of the Worldwide, Retaliatory, or Trafficking Tariff Orders. The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs. The Trafficking Tariffs fail because they do not deal with the threats set forth in those orders. This conclusion entitles Plaintiffs to judgment as a matter of law; as the court further finds no genuine dispute as to any material fact, summary judgment will enter against the United States. See USCIT R. 56. The challenged Tariff Orders will be vacated and their operation permanently enjoined."
So that last line is the current state: "The challenged Tariff Orders will be vacated and their operation permanently enjoined." Immediately, it appears.
A useful question for companies owed a refund is whether they can use their credit against the United States for other debts to the United States, including taxes.
[1] https://www.cafc.uscourts.gov/opinions-orders/25-1812.OPINIO...
[2] https://storage.courtlistener.com/recap/gov.uscourts.cit.170...
Yes, legislating can be hard and take time. And, yes, it can be tempting to bypass Congress when some pressing problem arises. But the deliberative nature of the legislative process was the whole point of its design. ... But if history is any guide, the tables will turn and the day will come when those disappointed by today’s result will appreciate the legislative process for the bulwark of liberty it is.
When I came to the opinion from Jackson, J., I found it extremely compelling. He says this:
... But some of TWEA’s sections delegating this authority had lapsed, and “there [was] doubt as to the effectiveness of other sections.” Accordingly, Congress amended TWEA in 1941, adding the subsection that includes the “regulate ... importation” language on which the President relies today. The Reports explained Congress’s primary purpose for the 1941 amendment: shoring up the President’s ability to control foreign-owned property by maintaining and strengthening the “existing system of foreign property control (commonly known as freezing control).”
When Congress enacted IEEPA in 1977, limiting the circumstances under which the President could exercise his emergency authorities, it kept the “regulate ... importation” language from TWEA. The other two relevant pieces of legislative history—the Senate and House Reports that accompanied IEEPA—demonstrate that Congress’s intent regarding the scope of this statutory language remained the same. As the Senate Report explained, Congress’s sole objective for the “regulate ... importation” subsection was to grant the President the emergency authority “to control or freeze property transactions where a foreign interest is involved.” The House Report likewise described IEEPA as empowering the President to “regulate or freeze any property in which any foreign country or a national thereof has any interest.”
However, then I read Kavanaugh, J. who writes the following:
In 1971, President Nixon imposed 10 percent tariffs on almost all foreign imports. He levied the tariffs under IEEPA’s predecessor statute, the Trading with the Enemy Act (TWEA), which similarly authorized the President to “regulate ... importation.” The Nixon tariffs were upheld in court.
When IEEPA was enacted in 1977 in the wake of the Nixon and Ford tariffs and the Algonquin decision, Congress and the public plainly would have understood that the power to “regulate ... importation” included tariffs. If Congress wanted to exclude tariffs from IEEPA, it surely would not have enacted the same broad “regulate ... importation” language that had just been used to justify major American tariffs on foreign imports.
And I also find this compelling.
To add onto this, Roberts, C. J. says: IEEPA’s grant of authority to “regulate ... importation” falls short. IEEPA contains no reference to tariffs or duties. The Government points to no statute in which Congress used the word “regulate” to authorize taxation. And until now no President has read IEEPA to confer such power.
This seems directly contradictory to Kavanaugh, J.'s dissent! Kavanaugh, J. claims that Nixon used the word “regulate” to impose tarrifs. And apparently the word isn't just in some random other statute — Nixon did so from TWEA, the predecessor of IEEPA: when Congress enacted IEEPA in 1977 it kept the “regulate ... importation” language from TWEA. (from Jackson, J.) So the point that no President has read IEEPA to confer such power seems pretty weak, when Nixon apparently did so from TWEA.
I have no conclusion from this, but IMO both Jackson, J. and Kavanaugh, J. have pretty strong points in opposing directions.
Zing! Surprisingly spicy writing for such a gravely serious body.
But unfortunately, there are other channels for them to effectively do the same thing, as discussed in oral arguments. So still not a major win for American manufacturers or consumers, I fear.
Actually they’re still doing it. I saw it not 2 minutes after seeing this post initially. The justifications for why they were “good, actually” has gotten increasingly vague though.