The U.S. Supreme Court's tough questioning of President Donald Trump's global tariffs has fueled growing speculation that they will be overturned, but it also raises the potential for further turmoil as he is expected to shift to other trade tactics after an adverse ruling.

On Wednesday, during oral arguments, the Supreme Court justices cast doubt on Trump's authority to impose tariffs under the 1977 International Emergency Economic Powers Act (IEEPA), which contains no reference to tariffs—only language about regulating imports during a national emergency declared by the U.S. president.

"Based on the justices' questions, the IEEPA tariffs appear to be in jeopardy," said Damon Pike, a leader in BDO USA's customs and trade services practice. He added that all but Samuel Alito and Clarence Thomas of the court "appeared skeptical that the IEEPA gives President Trump the authority to impose unlimited tariffs on every product imported from every country in the world."

However, Pike said that if the Trump administration loses, they will simply implement another trade law, a view widely shared by trade lawyers, senior Trump administration officials, import companies, and analysts.

These groups are just getting used to the idea of ​​a somewhat more stable trade environment, bolstered by a year-long U.S.-China trade truce and more U.S. deals with Southeast Asian countries that have lowered IEEPA tariffs to more manageable levels. Companies have been demanding certainty and predictability in tariffs so they can plan their investments, but Conference Board policy executive David Young said he doesn't see any relief.

"We still don't have clarity—CEOs are still in a somewhat precarious position about what the future looks like," said Young, who briefed about 40 CEOs after the Supreme Court arguments. "Even if this decision goes against IEEPA, the uncertainty persists." A ruling is unlikely before early 2026, Young said, and companies are completely unaware of the potential return of more than $100 billion in IEEPA tariffs paid so far if Trump loses. (alg)

Source: Reuters