'Hard to keep lights on' - Business owners cautiously welcome tariff ruling

February 20, 2026

The Supreme Court's decision to strike down President Trump's authority to impose sweeping tariffs using the 1977 International Emergency Economic Powers Act has generated cautious optimism among business owners, though significant uncertainty remains. While companies like toy makers and retailers welcome the potential relief from tariffs that had reduced profits by as much as 25%, they face questions about obtaining refunds for already-paid duties and concerns about alternative tariff measures the administration might deploy. Trump has already indicated plans to implement a 10% global tariff under different legal authority, meaning businesses will continue facing historically high import taxes averaging 9.

Who is affected

Small business owners like Jenelle Peterson of Wild Life Outdoor Adventures (toy imports from China)
Learning Resources (educational toy maker and plaintiff in the case)
US consumers facing higher prices on imported goods
Small businesses represented by Small Business Majority advocacy group
US importers and retailers represented by the National Retail Federation
Larger companies and members of the US Chamber of Commerce
Investors and financial markets
Households dealing with tariff-related price increases

What action is being taken

The Trump administration is planning to sign an executive order imposing a 10% global tariff under a separate statute
Businesses are holding prices steady or have already raised prices in response to tariffs (Peterson raised a knot-tying game from $14.99 to $19.99)
Trade associations are urging lower courts to ensure a seamless refund process for paid tariffs
Markets are weighing the implications of the ruling and potential next moves in trade strategy

Why it matters

This ruling represents a significant check on presidential tariff authority and could provide relief to businesses struggling with reduced profit margins and consumers facing higher prices. Even with these tariffs struck down, the US faces its highest average effective tariff rate (9.1%) since 1946 excluding 2025, meaning substantial trade-related economic pressure continues. The decision affects fundamental business operations including import decisions, product design investments, pricing strategies, and supply chain planning. The outcome also highlights the broader constitutional question of executive power limits and creates ongoing uncertainty that hampers business planning and investment decisions across the economy.

What's next

Trump plans to sign an executive order to impose a 10% global tariff under a separate statute allowing up to 15% import taxes for 150 days
The lower court will need to establish a process for refunding tariffs to US importers
Trump expects the tariff issue to be tied up in court for years
The by-sector and by-country implications of any replacement tariffs will need to be determined, creating another period of trade policy uncertainty

Read full article from source: BBC