Not so fast: Trump can still impose tariffs despite court ruling — here's how

Economic Times

29-05-2025

Trump Still Has Tools to Raise Tariffs
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Hold your horses—despite a recent federal court ruling that blocked one of Donald Trump 's tariff tactics, the US president still has multiple legal avenues to hit foreign imports with new taxes.A three-judge panel from the U.S. Court of International Trade ruled that Trump overstepped his authority under the 1977 International Emergency Economic Powers Act (IEEPA) when he declared a national emergency and imposed sweeping tariffs on global imports. The court said the law was never meant to support such broad trade restrictions.While the decision marks a legal setback, it doesn't mark the end of Trump's tariff playbook.Alec Phillips, Chief U.S. Political Economist at Goldman Sachs, told thestreet.com that the Trump team still has other legal tools at its disposal—some of which could be deployed almost immediately.Trump could invoke Section 122 of the Trade Act of 1974, which allows the president to impose tariffs for up to 150 days without a formal investigation. The rationale? To address a balance of payments deficit or prevent a major depreciation of the U.S. dollar.Phillips believes this could enable Trump to quickly slap on a 15% across-the-board tariff again—though it's unclear if they could be paused and resumed later.Already used during Trump's first term, Section 232 enables tariffs based on national security concerns. That's how previous tariffs on steel, aluminum, and autos were justified.Experts say Trump could expand this approach to include items like pharmaceuticals, semiconductors, and consumer electronics under similar claims.For broader, longer-lasting tariffs, Trump could launch Section 301 investigations into unfair trade practices by other countries. These probes take time—weeks or more—but could justify higher, targeted tariffs once completed.Section 338 of the Trade Act of 1930 allows tariffs up to 50% on countries that discriminate against the U.S. No formal investigation is required. While this provision has never been used, it remains legally available.Goldman Sachs says the most likely scenario would see Trump using Section 122 for quick, short-term tariffs while simultaneously kicking off Section 301 investigations to justify longer-term measures.That said, there's a practical ceiling. Only so many countries can realistically be targeted in a 150-day window, meaning smaller nations or those with modest trade surpluses may be spared.