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The case could move to the US Court of Appeals for the Federal Circuit and possibly return to the Supreme Court.
2 min readMay 8, 2026 05:30 AM IST First published on: May 8, 2026 at 05:29 AM IST
US President Donald Trump speaks. (Photo: AP)
A US federal court has ruled against new global tariffs imposed by Donald Trump, finding they were not authorised under the law, according to Associated Press (AP).
A split three-judge panel of the US Court of International Trade ruled 2-1 that the 10 per cent tariffs were illegal after small businesses challenged them.
The majority said the tariffs were “invalid” and “unauthorised by law”, adding that the president had gone beyond the powers granted by Congress.
One judge disagreed, saying the law gives the president more flexibility on tariffs. The tariffs were introduced under Section 122 of the Trade Act of 1974 after the US Supreme Court in February struck down broader tariffs imposed earlier.
The administration is expected to appeal the decision. The case could move to the US Court of Appeals for the Federal Circuit and possibly return to the Supreme Court.
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The ruling applies directly to the plaintiffs in the case the state of Washington and two companies, Burlap & Barrel and Basic Fun!.
“It’s not clear” if other businesses must continue paying the tariffs, AP quoted Jeffrey Schwab of the Liberty Justice Center, which represented the companies, as saying.
“We fought back today and we won,” AP quoted Basic Fun! CEO Jay Foreman as telling reporters.
The decision marks another legal setback for the Trump administration’s trade policy. Earlier, the Supreme Court ruled that the International Emergency Economic Powers Act did not allow the broad tariffs imposed last year.
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Under the US Constitution, Congress has the power to set tariffs, although it can delegate some authority to the president.
The administration is considering further steps, including investigations into trading partners and the import of goods linked to forced labour, which could lead to new tariffs.
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