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The Supreme Court issued its decision on President Trump’s International Emergency Economic Powers Act tariffs on Friday, ruling that the statute does not authorize the president to impose tariffs as its text does not mention tariffs, duties or the power to tax.

• “Today’s decision underscores the importance of clarity and durability in U.S. trade policy,” NAM President and CEO Jay Timmons and Rockwell Automation Chairman and CEO and NAM Board Chair Blake Moret said in a statement during the NAM State of Manufacturing Tour.

The reasoning: Here’s what the decision means in detail, according to the NAM’s trade and legal experts. 

• At 170 pages long, the 6–3 opinion by Chief Justice John Roberts and accompanying four concurrences and two dissents appears complicated. However, the reasoning that secured support from a majority of the justices rests simply on the text of IEEPA and its omission of the word “tax.”
• Given that the Framers of the Constitution gave the taxing power to Congress alone, the six justices in the majority agreed that the omission of “tax” in the “lengthy list of powers” described in IEEPA is significant: “It stands to reason that had Congress intended to convey the distinct and extraordinary power to impose tariffs, it would have done so expressly—as it consistently has in other tariff statutes,” they wrote.
• “When Congress grants the power to impose tariffs, it does so clearly and with careful constraints. It did neither here,” the justices continued.

Major Questions Doctrine: A subset of the majority (Chief Justice Roberts and Justices Neil Gorsuch and Amy Coney Barrett) also found the president’s use of IEEPA to impose tariffs to be unlawful under the Major Questions Doctrine—the separation of powers principle that Congress does not delegate “highly consequential power” through vague or ambiguous statutory language.

• The MQ doctrine applies with particular force where, as here, the purported delegation involves a core congressional function. The justices noted that, “the foreign affairs implications of tariffs do not make it any more likely that Congress would relinquish its tariff power . . . without careful limits.”
• The justices underscored that no president has ever invoked IEEPA to impose tariffs and that the breadth of power asserted over the national economy here (trillions of dollars) is “extravagant.”

Refunds: The court did not rule on whether the government must issue refunds, with only Justice Brett Kavanaugh mentioning refunds in his dissent. “The United States may be required to refund billions of dollars to importers who paid the IEEPA tariffs, even though some importers may have already passed on costs to consumers or others,” he wrote.

• The Court of International Trade will likely address refunds when it resolves the roughly 2,000 refund lawsuits currently pending and stayed before that court.

Other tariffs still stand: The decision does not impact tariffs issued under other statutory authorities, including Sections 301, 232 or any anti-dumping/countervailing duty orders in place.

NAM in the news: The Washington Times and Manufacturing Dive covered the NAM’s response to the Supreme Court decision.

Learn more: The NAM International Policy team and Legal team will co-host a webinar tomorrow, Feb. 25, about the future of tariff policy and potential refunds, exclusively for NAM members. It will feature experts Michael Jacobson of Hogan Lovells trade litigation practice and Katie Wellington of Hogan Lovells appellate and Supreme Court litigation practice. Sign up here.