On February 20, 2026, the U.S. Supreme Court delivered one of the most consequential trade rulings in decades, striking down a broad set of tariffs imposed by President Donald Trump in a 6–3 decision. At the heart of the case was a simple but far-reaching question: does the International Emergency Economic Powers Act of 1977 give the president authority to impose tariffs?

The Court’s answer was clear. Writing for the majority, Chief Justice John Roberts held that it does not. The statute, he noted, “contains no reference to tariffs or duties,” and until Trump, no president had ever claimed that it did. When Congress intends to grant tariff-setting authority, the Court said, it does so explicitly and with defined limits. IEEPA does neither.

The majority opinion was notable not only for its reasoning but for its composition. It brought together justices from across the ideological spectrum, including three appointed by Trump himself. Those justices joined Roberts in applying the “major questions doctrine,” which requires explicit congressional authorization for executive actions with vast economic consequences. In doing so, they rejected the idea that a decades-old emergency powers statute could be stretched to justify sweeping trade measures.

The dissent, authored by Justice Brett Kavanaugh and joined by Justices Clarence Thomas and Samuel Alito, took a different view. Kavanaugh argued that tariffs are a traditional tool of trade regulation and that policy disputes over their wisdom belong in the political arena, not the courts. Trump seized on that dissent, publicly praising Kavanaugh and emphasizing language suggesting the ruling might not fully constrain future presidents.

The president’s response was swift and defiant. Within hours, Trump announced a new 10% global tariff under a different provision of the Trade Act of 1974, along with plans for a broader 15% levy. His message was unmistakable: if one legal pathway is closed, others will be pursued.

The ruling leaves unresolved a major practical question: what happens to the roughly $175 billion collected under the invalidated tariffs. That issue now falls to lower courts, creating legal uncertainty and potential fiscal consequences. For now, markets have taken the news in stride. Treasury yields were largely unchanged, while equities rallied.

More broadly, the decision marks a rare and meaningful reassertion of constitutional limits on executive power. The Court clarified that tariffs function as taxes on U.S. consumers and businesses, and under the Constitution, only Congress has the authority to impose new taxes. The principle is as old as the republic itself: no taxation without representation.

Whether this ruling will temper or intensify Trump’s approach is an open question. The early signs suggest escalation rather than restraint. If so, the implications for trade policy, market stability, and the political climate ahead of the November midterm elections could be significant.