Tariff Supreme Court Hearing: Now What?
The Supreme Court heard arguments for and against upholding President Trump’s tariffs implemented under the International Emergency Economic Powers Act (IEEPA) in the Learning Resources, Inc. v. Trump, President of U.S. case. Access the recording of the hearing here.
What were the arguments in the tariffs case hearing?
Three “themes” discussed in the oral arguments included:
- Interpretations of the plain text language of IEEPA and the powers it affords the President. This includes whether the power to levy tariffs is included in the phrase “regulate importation”, and what “licenses, or otherwise” encompasses tariffs..
- Whether the power to embargo trade (arguably a more extreme reaction) would imply that the President should be able to levy a tariff (arguably a less extreme reaction).
- Analysis of the Nondelegation Doctrine and the required limitations on powers that Congress delegates to the President, especially in the context of foreign affairs.
What are the next steps toward issuing a decision?
After many hours of discussion the justices will complete a preliminary vote which will then be followed by the drafting of opinions. There could be a majority opinion, a concurring opinion, and a dissenting opinion depending on the stances of the various justices. Prior to publication, drafts are circulated among the justices, giving the opportunity for revisions and discussion. The process of issuing a final opinion does not have a set timeline, though in recent cases it has taken around two to four months following oral arguments.
Are tariffs going away?
Regardless of the outcome of this case, tariffs issued under other Sections will still be in place. This includes tariffs under Section 301 (e.g. tariffs on China) and Section 232 (e.g. copper, aluminum, vehicle tariffs). In fact, President Trump has made the decision to issue recent tariffs under Section 232 instead of IEEPA, likely for this reason. Therefore, tariffs in some form will remain. In the oral arguments, there was some discussion about the possibility of President Trump levying tariffs under Section 338, an option that has not previously been pursued.
What should I do now?
If you are an importer of record and have already paid an IEEPA tariff, stay up to date with the outcome of the case. It could be possible that you will have the opportunity to receive a refund for the tariff already paid. If you have not yet paid an IEEPA tariff but anticipate you will soon, it could be worth considering filing for an extension of your “entry liquidations”. As discussed in this recent alert, in the event that the IEEPA tariffs are overturned, an extension would allow you to avoid paying the tariff, filing for a refund, and having to wait to receive your cash.