The U.S. Supreme Court announced this morning, Feb. 20, in a 6-3 decision that the Trump Administration cannot use IEEPA to impose tariffs. The Court held that tariffs are a form of taxation, and under the U.S. Constitution, the power to impose taxes and duties belongs to Congress unless Congress clearly and specifically delegates that authority. Because IEEPA does not expressly authorize tariffs, the tariffs imposed under that statute were found to be unlawful.

What this means in practical terms: the ruling effectively ends the use of IEEPA as a legal basis for imposing or maintaining tariffs going forward. Any future tariffs must be imposed under other trade laws that explicitly authorize duties (such as Section 232, 301, or safeguard statutes) and follow the procedural and substantive limits set by Congress.

What this decision does not do: the Court did not order refunds of duties already paid, nor did it establish an automatic mechanism for recovering past payments.

Justice Kavanaugh explicitly notes this omission: “The Court says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers.” Therefore, at this time there is no clear instruction from the Court and more specifically US Customs and Border Protection (CBP) on refunds of previously paid duties.  Further, we must wait for to update their systems to remove the relevant HTS related to the IEEPA Tariffs.