Today, the US Supreme Court will hear oral arguments in two consolidated cases challenging the legality of tariffs imposed under the International Emergency Economic Powers Act (IEEPA).
At issue are two major sets of tariffs:
- Global “Reciprocal” Tariffs: A baseline 10% tariff on most US trading partners, with higher rates on select countries.
- Fentanyl-Related Tariffs: Additional duties on imports from China, Canada, and Mexico.
Lower courts previously ruled these measures unlawful, finding that IEEPA does not grant the executive branch authority to impose tariffs. The federal government appealed, arguing that such duties are a legitimate means to regulate imports during a declared national emergency.
Key Issues Before the Court
The justices will consider two central questions:
- Whether IEEPA’s authorization to “regulate importation” includes the power to impose tariffs.
- Whether extending such power to the executive branch violates the constitutional separation of powers.
Petitioners, including small businesses and several states, argue that tariffs constitute taxes—an authority reserved for Congress. The administration counters that removing tariff authority under IEEPA could have “catastrophic consequences” for national security and trade enforcement.
Potential Impact for Importers
The Court’s ruling will have significant implications for importers and brokers:
- If the tariffs are upheld: They remain in effect, and no refund opportunities will be available.
- If the tariffs are struck down: Importers could become eligible for refunds on duties paid since February 2025. However:
- Refunds will likely depend on timely Post Summary Corrections (PSCs), protests, or other administrative actions.
- The process will likely be complex, time-sensitive, and not automatic.
Recommended Actions for Importers
Importers should take proactive steps now to preserve potential rights and prepare for possible outcomes:
- Review and document all entries subject to IEEPA tariffs since February 2025.
- Track liquidation dates and consider filing protests within 180 days of liquidation.
- Monitor the case closely—a decision is expected before the Court’s term ends in mid-2026.
How Mohawk Global Can Help
Mohawk Global Trade Advisors can assist importers in assessing exposure and preparing compliance strategies, including:
- ACE reporting and entry data analysis
- PSC and protest filing support
- Modeling potential refund scenarios
For guidance or assistance, please contact your Mohawk Global representative.