U.S. Supreme Court Rules Against Trump’s Tariffs
February 26, 2026 | Last Updated on: February 26, 2026
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The U.S. Supreme Court (SCOTUS) ruled on Friday, Feb, 30, that the Trump Administration did not have the authority to impose most of the tariffs that it has imposed. In a highly anticipated 6-3 ruling, SCOTUS said that the Trump Administration overstepped its authority by imposing tariffs under the International Emergency Economic Powers Act (IEEPA). The ruling marks a major blow to one of the centerpieces of the administration's economic plan, which justified tariffs to address a national economic emergency.
The administration previously state that tariffs are necessary to curb the flow of illegal narcotics such as fentanyl into the U.S., and as retaliation for the influx of illegal immigrants coming into the country. It has also reported that the government has collected roughly $89 billion from tariffs. Economic groups such as The Tax Foundation have noted that the sweeping tariffs have squeezed small businesses by increasing the price of coffee, food products, apparel and electronics, among many other products, and have caused the cost of living to go up for Americans.
The ruling also allows thousands of U.S. companies that were affected by the tariffs to apply for refunds, although they will most likely have to go through a complex legal process in order to collect money. Despite the ruling, the administration could still try to impose tariffs under other laws, but the broad tariffs that it had imposed on countries such as China, Taiwan, Canada and Mexico will be lifted.
How Does This Affect Small Businesses?
The ruling most likely represents a huge sigh of relief for U.S. small businesses, especially for those that relied on imports to operate. The tariffs imposed by the Trump Administration forced many businesses to raise the prices of their products and reduced their profits, according to the U.S. Chamber of Commerce. In a report published in May, the Chamber reported that 97% of all importers in the U.S. are small businesses. It also found that:
- Small businesses were responsible for a third of the total value of goods imported.
- Half of the small businesses that have been affected by tariffs have been very small businesses, employing 50 or fewer employees, and
- Nearly 40,000 of the small businesses in the U.S. affected by tariffs are manufacturing businesses that rely on imported products in their manufacturing products.
The Trump Administration has yet to issue a response to SCOTUS' ruling.
A Bi-Partisan Ruling
The Trump Administration's tariff policy has been unpopular among voters, but many financial institutions, including JPMorgan, were unsure how SCOTUS would rule on the case given that it has ruled in favor of President Trump in the past. In the final ruling, which was written by Chief Justice John Roberts, he and two of his fellow conservatives, Justices Neil Gorsuch and Amy Coney Barrett (both appointed by Trump) joined the three liberal justices in ruling against Trump's tariff policy. Conservative Justices Samuel Alito, Clarence Thomas and Brett Kavanaugh dissented.
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