Trump tariff policy in tatters after being ‘declared invalid’ by US court
Donald Trump’s sweeping global tariff plans have been thrown into doubt after a court said the US President’s executive orders under which they were introduced were “declared to be invalid as contrary to law.”
The US Court of International Trade found that the president lacked the authority to use emergency economic powers legislation when he launched his so-called ‘Liberation Day’ tariffs last month.
The ruling, which was made in response to cases brought by US businesses and a handful of US states, found that “The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President …to regulate importation by means of tariffs.”
Trump had sought to push through the tariffs under emergency powers afforded to the White House, arguing that tariffs imposed on the US by other major economies suppressed US wages and amounted to an “unusual and extraordinary threat” to the US economy, an argument that was rejected by the court.
The ruling applies to tariffs introduced on April 2, including a global baseline 10 per cent tariff as well as higher reciprocal tariffs imposed on specific trading partners – but it excludes sectoral tariffs such as on cars and steel imports.
Markets react positively to court ruling
The judgement pours cold water on White House plans to negotiate more favourable terms with trading partners by raising the spectre of much higher tariffs if they fail to reach a deal.
Markets responded positively to the ruling, which is likely to curtail Trump’s ability to disrupt global trade.
S&P futures rose 1.7 per cent while Hong Kong’s Hang Seng index was up 1.2 per cent. The FTSE 100 edged up 18 points in early London trade.
The White House has criticised the ruling, saying “it is not for unelected judges to decide how to properly address a national emergency,” adding: “President Trump pledged to put America First, and the Administration is committed to using every lever of executive power to address this crisis.”
The White House has said it intends to appeal the decision, which will keep the tariffs in place at least until an appeal hearing is concluded.
But the move was celebrated by Democrat officials. Ron Wyden, the senator from Oregon, said: “I argued from the start that Donald Trump’s claim that he could simply decree sky-high new taxes on imported goods depended on mangling the Constitution beyond recognition.”