Arya News - Trump already has the ability to impose replacement tariffs to make up nearly three-quarters of the tax revenue the Supreme Court may strike down as illegal.
WASHINGTON – Businesses and consumers hoping the Supreme Court will soon do away with President Donald Trump’s massive, 12-figure tax increase on imports by striking down his “emergency” tariffs are likely to be disappointed, with administration officials already laying the groundwork to replace them with others.
“That can be done almost immediately,” said Clark Packard, a trade researcher with the Cato Institute.
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After returning to office a year ago, Trump quickly jacked up existing tariffs on China, implemented and expanded ones on steel, aluminum and automobiles and then created a novel, never-before-tried import tax based on the 1977 International Emergency Economic Powers Act to hit goods from every country in the world.
The result was a quintupling of the overall average tariff rate, which had been about 2.2% when he took office, and a total tax increase of $181 billion. That figure dwarfs the tax increases under President Barack Obama and ranks as the 13th biggest tax hike since before World War II. Erica York, the vice president for Federal Tax Policy at the conservative-leaning Tax Foundation, said it was the biggest tax increase since 1993.
The Supreme Court is expected to decide as early as this month on Trump’s tariffs based on IEEPA , a law that does not give him that specific authority. At oral arguments in November, most of the justices seemed skeptical of the idea that Trump has the ability to set tariffs according to his whim and without any approval by Congress, which, under the Constitution, is given the sole power of taxation.
Trade experts, though, point out that while striking down the IEEPA tariffs would offer some stability for businesses, the administration has both the ability and the expressed willingness to immediately levy import taxes using different means that will cost Americans nearly as much.
“If the court strikes IEEPA down, it does hamstring the ability of the president to set baseline tariffs, but it doesn’t mean we’re in the clear,” York said.
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A Maersk cargo ship navigates through New York Bay on Jan. 23, 2026. CHARLY TRIBALLEAU via Getty Images
The administration turned to the IEEPA law, which had never previously been used to impose tariffs and never directly mentions tariffs in its text, because almost every other method of imposing them requires investigations or comment periods, making it difficult for Trump to raise and lower rates at will, as he prefers.
Trump, for example, wrote in a social media post Monday that he lowered the 25% import tax on Indian products to 18% based on a good conversation with India’s prime minister about a trade agreement.
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“Out of friendship and respect for Prime Minister Modi and, as per his request, effective immediately, we agreed to a Trade Deal between the United States and India, whereby the United States will charge a reduced Reciprocal Tariff, lowering it from 25% to 18%. They will likewise move forward to reduce their Tariffs and Non Tariff Barriers against the United States, to ZERO,” Trump wrote.
He previously imposed a 50% tax on Brazil, largely because he is angry that prosecutors and courts there imprisoned his friend, former President Jair Bolsonaro, for attempting a coup to remain in power after losing reelection.
Tariffs imposed under IEEPA account for about three-quarters of the new revenue created by Trump’s policies, according to U.S. Customs figures, and losing the ability to impose tariffs under it would mean a sudden loss of more than $150 billion for 2026.
Neither Trump’s White House nor the United States Trade Representative would respond to HuffPost queries about what Trump would do should the court rule as widely anticipated.
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Instead, White House spokesperson Kush Desai claimed that justices would rule with Trump. “The administration is confident in ultimate victory on this matter by the Supreme Court,” he said.
In other public comments, however, the administration has acknowledged it is ready to use alternative methods to impose similar trade barriers. “We also have a backup plan that’s really solid. We can put a 10% tariff right away,” White House economic adviser Kevin Hassett said in an interview with Fox Business last month. “And then use things like the 301 authorities, the 232 authorities, to backfill.”
York and others believe the “backup plan” Hassett spoke of refers to a provision of a 1974 law governing trade policies that grants the president the power to impose tariffs of up to 15% to correct a trade imbalance ― but only for 150 days unless Congress approves.
This authority, known as Section 122, would enable him to collect about 75% of the revenue he was collecting under IEEPA if he slapped a 15% tariff on every American trading partner. Beyond five months, though, Trump would likely need to turn to other powers.
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Section 301 of that 1974 law, for example, allows a president to set retaliatory tariffs against a country for creating unfair trade barriers against U.S. exporters, but requires an investigation and public comment period before they can go into effect.
Section 232 of a 1962 trade law permits tariffs on classes of goods if a president believes they are necessary to protect U.S. national security. Those also require an investigation before they can be implemented.
Cato’s Packard said the tariff on imported steel could be expanded to cover products made with that steel.
“They could say my dishwasher, because it contains steel, is a national security threat,” he said. “I think that’s a stretch.”
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York agreed that such a redefinition seems outlandish, but added that that by itself would not stop Trump from trying it. “You can’t say it with a straight face,” she said. “But there’s not much hesitation from this administration to stretch these statutes.”
While Trump frequently lies that tariffs are paid by the exporting countries, in reality, they are paid by the importer at the port of entry. Those taxes are then either eaten by the owner or shareholders of the company or passed along to consumers in the form of higher prices. A recent Kiel Institute study found that 96% of tariffs were paid by Americans, with only 4% absorbed by exporters.
Trump is also prone to vastly overstating the amount of money that his tariffs are generating and has claimed they could pay for projects and rebates that would cost many multiples of the actual tariff revenue. He personally has claimed that an adverse ruling by the Supreme Court would be a catastrophe for the country – a matter of “LIFE OR DEATH.”
Despite the likelihood that Trump will be able to reimpose tariffs that will continue to slow the economy and increase inflation, Trump critics who worry about his increasingly autocratic statements and actions said a Supreme Court ruling knocking down his claim of “emergency” powers to impose import taxes would be a welcome development.
Ty Cobb, a former lawyer in Trump’s first-term White House, said the dozens of emergencies Trump has declared are a key part of the effort by top aides like Stephen Miller to undo constitutional limits on Trump’s power.
“Phony emergency declarations and national security claims are at the heart of that strategy,” he said. “Time for the Supreme Court to signal that it understands that important point.”
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