Washington, D.C. — The legality of Donald Trump’s sweeping tariffs will be tested next week before the U.S. Supreme Court, in a case that could reshape presidential power over international trade and have major implications for global commerce — including with Canada.
The challenge, led by New York wine importer Victor Owen Schwartz and other small businesses, argues that the former president’s use of the International Emergency Economic Powers Act (IEEPA) to impose duties on nearly every trading partner exceeded his legal authority. The 1977 law allows presidents to regulate economic transactions in a national emergency but makes no mention of tariffs, which the U.S. Constitution assigns to Congress.
Trump invoked IEEPA in declaring “economic emergencies” tied to trade deficits and fentanyl trafficking, enabling “reciprocal” and fentanyl-related tariffs on Canada, Mexico, China, and others. Both the U.S. Court of International Trade and the Federal Circuit Court of Appeals previously ruled those tariffs unlawful, setting up next week’s historic Supreme Court hearing.
“The president says he can impose tariffs on any country, at any rate, at any time, for any reason,” said Jeffrey Schwab of the Liberty Justice Center, representing the plaintiffs. “That can’t be what IEEPA means — it’s not a blank cheque.”
Trump has publicly defended his tariffs, calling them vital to U.S. economic independence and warning of “terrible consequences” if the court strikes them down. He has even hinted at attending the hearing in person.
Critics say the duties have hurt American importers and consumers. The Tax Foundation estimates the tariffs have raised the average U.S. rate by 13 percentage points and generated US$88 billion in revenue, largely paid by domestic companies.
Economists at the Cato Institute and Stanford Law School describe the dispute as a defining test of executive versus congressional authority. “This is one for the ages,” said Stanford professor Michael McConnell, noting the case could determine how far presidents may go in wielding emergency economic powers.
If the court rules against Trump, both the “reciprocal” and fentanyl-related tariffs would be struck down — potentially ending years of trade tension and uncertainty for U.S. businesses and trading partners such as Canada.