Trump suffers blow on 10% tariff, court says it's illegal
The US Trade Court has issued a major ruling on the 10 percent tariffs imposed by Trump, calling them "invalid" and "unauthorized."
US President Donald Trump has suffered another setback regarding tariffs. The US Trade Court has declared the 10 percent tariff imposed by Trump illegal.
Previously, the Supreme Court had declared Trump's tariffs unconstitutional. However, the court only blocked the tariffs for two private importers and Washington state.
According to an Associated Press report, a three-judge panel of the Court of International Trade in New York ruled in a 2-1 decision that the 10% tariffs were illegal following a lawsuit brought by small businesses.
The court said Trump had violated the authority granted to the president by Congress under the law. The court also called the tariffs "invalid" and "unauthorized."
The court's decision currently blocks the collection of tariffs directly from Washington state and two companies: spice company Burlap & Barrel and toy company Basic Fun.
The dispute centers on a temporary 10% global tariff imposed by the Donald Trump administration in February after the Supreme Court overturned massive double-digit tariffs imposed on nearly every country last year.
The new tariffs imposed in February were implemented under Section 122 of the Trade Act of 1974 and are set to expire on July 24th.
A court hearing was held regarding this. However, the court refused to accept the proposal to exempt the remaining 24 importers from the tariffs. Currently, only three importers have been exempted.
What can happen next?
Jeffrey Schwab, senior counsel at the Liberty Justice Center, which is representing small businesses, said further action will depend on the Trump administration's actions and whether the US Department of Justice appeals the ruling.
Jay Foreman, CEO of Basic Fun Inc., one of the companies filing the case, welcomed the court's decision. He said it was extremely courageous for small businesses to take on such a legal battle. According to Foreman, his company has already paid over $100,000 under the disputed tariffs.
What was the decision of the Supreme Court
Previously, the US Supreme Court had declared President Trump's arbitrary tariffs illegal, after which Trump devised the 10 percent tariff plan. This historic Supreme Court decision came 6-3.
At the time, the court stated that Trump was the first president to invoke an emergency law from the 1970s to impose tariffs on more than 100 countries.
Furthermore, he also secured trade deals with several countries by threatening tariffs. This law does not mention the word "tariff" anywhere, so the court declared it unconstitutional.