Tariffs ruling is major blow to Trump's second-term agenda

February 20, 2026

The Supreme Court delivered a significant blow to President Trump's trade policy by ruling 6-3 that his sweeping tariff authority under the Emergency Economic Powers Act of 1977 was unconstitutional, determining that only Congress has the power to impose such tariffs. In response, Trump harshly criticized the justices, particularly the three conservatives who voted against him, and immediately promised to reimpose tariffs using alternative legal authorities, including a new temporary 10% global tariff. This decision represents a rare judicial constraint on Trump's executive power and may weaken his negotiating position with foreign trading partners while potentially requiring the administration to refund previously collected tariff revenue.

Who is affected

President Donald Trump and his administration
The six Supreme Court justices in the majority (and three dissenting justices)
Congressional Republicans, particularly those in battleground states and districts
American consumers who have paid costs from the tariffs
America's trading partners and foreign nations
Jamieson Greer, Trump's top trade adviser
Justice Brett Kavanaugh (who wrote the dissent)
The Federal Reserve governor facing dismissal

What action is being taken

Trump is signing a new temporary 10% global tariff on Friday
Trump is reimposing tariffs using presidential authority under other laws
Legal challenges involving executive power are working their way through the court system
A lower court will decide on the issue of tariff revenue refunds

Why it matters

This decision represents a significant check on presidential executive authority and undermines a key pillar of Trump's second-term agenda. It weakens Trump's negotiating position with foreign nations, as his reduced tariff powers make him appear less powerful and may embolden trading partners to take tougher stances. The ruling may force the administration to refund substantial tariff revenue collected over the past year, and it reduces political vulnerability for Republican candidates who have faced criticism over unpopular tariffs that increased consumer costs. Additionally, it sets a precedent that could affect other pending cases involving controversial uses of executive power, including efforts to end birthright citizenship and dismiss federal officials.

What's next

Trump will deliver his State of the Union Address on Tuesday, where he will face the Supreme Court justices who ruled against him
A lower court will decide whether the Trump administration must return tariff revenue collected over the past year
The Trump administration will pursue alternative tariff mechanisms that require government agencies to produce detailed reports
New tariffs will require longer lead-in times before implementation
Trump could potentially ask Congress for explicit authorization to impose tariffs, though success seems unlikely given narrow Republican majorities and upcoming midterm elections
Several other major cases involving executive power uses will proceed through the courts in the coming months

Read full article from source: BBC