Global tariffs levied by Trump illegal: US court

A federal appeals court in the US has ruled that President Donald Trump's global tariffs, including the 50% duties imposed on India, were illegally applied, dealing a major blow to the administration's trade strategy while casting uncertainty over trillions of dollars in global commerce.

- Shashank Mattoo

The US Court of Appeals for the Federal Circuit — roughly an equivalent of a high court in India — ruled 7-4 on Friday that Trump exceeded his authority by invoking a 1970s-era emergency law to impose the sweeping tariff regime, upholding an earlier decision by the Court of International Trade.

However, the landmark ruling will not take immediate effect, with the court setting October 14 as the deadline before any changes occur. This provides the Trump administration time to challenge the decision in the Supreme Court, which is widely expected.

The ruling specifically affects Trump's “reciprocal tariffs” that took effect August 7 and August 28, including the punitive duties on India. Imports from India into the US currently face a 50% tariff rate, comprising a 25% reciprocal tariff and an additional 25% penalty for purchasing Russian energy.

The decision also casts doubt over Trump’s tariff reduction deals with Japan, the European Union, the United Kingdom and South Korea, while affectingpenalties imposed on Canada and Mexico over alleged failures to counter cross-border drug trade.

The baseline 10% tariff imposed on all goods entering the United States since Trump's April 2 "Liberation Day" is similarly affected by the ruling.

The Federal Circuit found that while the International Emergency Economic Powers Act (IEEPA) grants the president authority to deal with national economic emergencies, it does not explicitly provide power to impose tariffs and duties-a prerogative that generally lies with Congress.