All eyes are on the US Supreme Court today for its ruling on US President Donald Trump’s tariffs against the trade partners of the country. The top court is expected to issue rulings on Friday, as it has scheduled January 9 as an “opinion day”- the first chance for a ruling on Trump tariffs. The court does not announce ahead of time which rulings it intends to issue. Media reports highlight that the US Supreme Court generally releases decisions around 10:00 a.m. Eastern Time (ET) on opinion days.
The US Supreme Court will now give its verdict on whether Trump can invoke the International Emergency Economic Powers Act (IEEPA) to impose tariffs without Congress's approval.
Practical and economic implications :
The stakes of the Supreme Court’s decision extend far beyond legal theory. The tariffs imposed under IEEPA have generated billions of dollars in revenue4 and have had a significant impact on global trade relationships. If the Court invalidates these tariffs, many companies will likely seek refunds, creating substantial administrative and financial challenges for the government. Moreover, the ruling could alter the dynamics of trade negotiations, as the threat of swift, sweeping tariffs has been a powerful tool in bringing other countries to the bargaining table.
Notably, certain tariffs – such as those imposed under Section 232 of the Trade Expansion Act 1962 and Section 301 of the Trade Act 1974 – would remain unaffected by the Court’s decision. These authorities provide alternative mechanisms for the administration to pursue its trade and national security objectives, albeit with more targeted and procedurally defined tools.
The tariffs imposed last year amounted to an average tax increase of $1,100 per U.S. household last year and are seen at $1,400 this year, according to the Tax Foundation, a think tank. It estimated that those numbers would shrink to $300 in 2025 and $400 this year if the IEEPA tariffs go away.
The court's decision may also land somewhere between full support or a complete rollback of Trump's tariffs. It could, for example, narrow the scope of the IEEPA tariffs to a few countries with which the U.S. runs a trade deficit, Morgan Stanley's policy strategists wrote earlier this week. It could also give the administration a "grace period" to change the legal authorities underpinning those tariffs and put a time limit on those currently in place.
And even if tariffs are fully scaled back, the Trump administration has alternative powers to replace or reimpose current tariff levels.
"Among other variables, timing is the largest unknown in these scenarios," Morgan Stanley wrote.