Trump's tariff regime case could reshape Congress' taxing power

WASHINGTON — The Supreme Court will hear oral arguments Wednesday over whether a law allows President Donald Trump to implement a worldwide tariff regime, in a case experts and lawmakers said ultimately could undermine Congress’ foundational power over taxation.

The Trump administration is set to urge the justices to find that those tariffs are within the powers that Congress gave to the presidency in an emergency economic powers law in 1977, with huge issues in the balance, including billions of dollars in federal tariff revenue and trillions of dollars in international trade.

The legal questions hinge on the wording in the law around regulating trade and declaring emergencies, how specific Congress must be when delegating large powers to the executive branch and whether Congress can turn over its constitutionally assigned role to establish tariffs.

But a larger question lurks over eroding the congressional power over the purse, at a time when Trump has pushed the boundaries of long-standing ideas on what presidents have the authority to do.

A decision in favor of the Trump administration would undermine the constitutional order on how federal funds are collected and spent, said Josh Chafetz, a Georgetown Law professor who specializes in the powers of Congress.

“It’s going to be a huge blow to Congress if Trump essentially can try to raise as much money as he wants by levying tariffs. That is creating a huge slush fund,” Chafetz said. “That is so deeply antithetical to the text of the Constitution and the struggle that birthed it.”

Chafetz said actions by the Trump administration to freeze funds, spend funds during the shutdown and raise revenue through tariffs are undermining the “three pillars” of Congress’ main power over federal spending.

“This administration has been not just chipping away but taking a sledgehammer to some of Congress’ core powers,” Chafetz said.

At the same time, a decision against the Trump administration would put pressure back on the Republican-controlled Congress to pass laws addressing a signature piece of Trump’s domestic and foreign policy, said Molly Reynolds, the interim vice president and director of governance studies at the Brookings Institution.

The country has experienced “several decades of increasing presidential power in lots of ways at the expense of congressional power,” with numerous decisions by members of Congress and the Supreme Court that effectively granted more power to the presidency, Reynolds said.

“I think it would sort of put the ball back in Congress’ court. Congress would have to decide if it wants to legislate and decide whether it wants to codify what Trump has asked for,” Reynolds said.

Legal case

This year Trump declared a swath of national emergencies under the National Emergencies Act, including problems tied to fentanyl smuggling, trade imbalances and the prosecution of former Brazilian President Jair Bolsonaro in his home country.

The administration then used those declarations to justify tariffs under a law called the International Emergency Economic Powers Act, or IEEPA. That includes specific tariffs against Canada, Mexico and China, the worldwide “Liberation Day” tariffs and others against countries such as Brazil.

The Trump administration has argued that Congress in IEEPA gave the president broad power to “regulate” trade in an emergency, which could include embargoing trade with another country entirely. Tariffs, the administration argued, are less extreme than that.

Earlier this year, the Court of International Trade and U.S. Court of Appeals for the Federal Circuit both found that the tariff regime violated federal law. They agreed with the challenges from the businesses and states that the law at issue did not mention tariffs or give specific rules for how they could be put in place.

Michael McConnell, a retired judge from the U.S. Court of Appeals for the 10th Circuit who represents one of the challengers to Trump’s tariffs, told reporters last week that allowing a president to impose tariffs without congressional approval would make it “very tempting” for an executive to end-run the legislative process to raise revenue.

“He has no power to authorize tariffs on American citizens without the authorization of Congress,” McConnell said.

In one bipartisan brief at the Supreme Court, more than 200 House and Senate members, including Alaska Republican Sen. Lisa Murkowski, argued that Trump’s tariffs “usurped” congressional authority over tariffs and taxes.

“The Administration’s interpretation of IEEPA would effectively nullify the guardrails set forth in every statute in which Congress expressly granted the President limited tariff authority — a result Congress did not intend,” the brief said.

“IEEPA does not grant the President the power to impose tariffs on American citizens importing goods to generate leverage in trade talks,” the brief said.

The brief argued that Congress has been specific in the past when it gave the president the power to collect tariffs and mostly limited those powers to tariffs on a single product or country.

A few Republicans have expressed misgivings about the tariffs and emergency powers and voted to overturn them.

Sen. Thom Tillis, R-N.C., who has criticized some of the Trump tariff decisions and voted to overturn the emergency declaration for Brazil last week, said he’s concerned about what the case could mean for the power of Congress.

“I worry less about what President Trump is doing now and more about what President Harris would do with that same sort of authority,” Tillis said, referring to Trump’s 2024 opponent, Kamala Harris.

Congressional action

A Supreme Court decision to uphold Trump’s tariffs could make it even harder for Congress to potentially undo those tariffs and other presidential actions, experts said.

They noted that the Supreme Court already defanged a major congressional tool to rein in the president’s emergency powers directly in a 1983 decision in an immigration case known as INS v. Chadha. The court invalidated the so-called legislative veto, which experts said extended to the same framework under the National Emergencies Act, the law Trump used to underpin the tariffs.

Congress passed the National Emergencies Act, along with IEEPA and other post-Watergate reforms, as a means of clearly defining the president’s emergency powers, Michael Thorning, associate director of governance at the Bipartisan Policy Center, said.

That 1983 decision leaves the legislative veto “essentially inoperative at the moment, until Congress acts to change it,” Thorning said.

“The authority granted to the president has not changed in scope or magnitude, but Congress’ ability to undo actions taken by the White House has changed,” Thorning said. “Congress is at a bit of a disadvantage because it essentially created an escape hatch for itself where it could vote to overturn an emergency and now can’t anymore.”

That means that instead of Congress being able to override emergency declarations on its own, they have to face a presidential veto, experts said.

That played out in the first Trump administration, when both chambers of Congress voted to override a national emergency declaration at the U.S. border with Mexico in 2019, only for Trump to veto the provision.

Sen. Tim Kaine, D-Va., a lead sponsor of Senate efforts to overturn the national emergency declarations in the current Congress, said he would continue to push for votes to override them, even if the Supreme Court determines that the tariffs are legal.

“If the court were to uphold that, they would sort of be solving that legal challenge, but again, from a policy matter, we still need to challenge emergencies that are bogus,” Kaine said.

Reynolds said a decision in favor of the Trump administration would also undermine the political case to overturn the emergency declarations.

“I expect that many Republicans in particular would point to that and say, ‘Look, the Supreme Court has said it is OK, and we are just going to go along with it,’” Reynolds said.

Tillis also said that a decision in favor of the Trump administration would “pretty much end the discussion” around overturning the emergency declarations underpinning the tariffs. It also wouldn’t bode well for broader legislation regarding the president’s emergency powers.

Even if a Republican-led Congress passed a measure to reclaim power over tariffs, Trump would have the power to veto it and keep that control for the executive branch.

“You’d have to take veto-proof congressional action to fix it if you wanted to claw back power. And that never happens,” Tillis said. “It hasn’t happened for the 80 years that we’ve conveyed too much power to the Article II branch, because we always make the mistake of living in the moment and not thinking about the long-term consequences.”

The cases are combined challenges from states and businesses who challenged the tariffs in lower courts. The cases are Learning Resources Inc. v. Trump and Trump v. V.O.S. Selections.