The U.S. federal government could be forced to refund an estimated $168 billion in tariff payments to businesses if the Supreme Court rules that President Donald J. Trump improperly invoked the International Emergency Economic Powers Act (IEEPA) to impose trade levies.
A critical hearing before the Supreme Court in November has raised questions about whether the administration’s use of emergency powers under the IEEPA is lawful. The law, which the administration claims grants the president broad authority to address “unusual and extraordinary threats,” has been challenged for its application to tariffs. Several justices have expressed skepticism during oral arguments, noting that the statute does not explicitly mention tariffs and lacks precedent for such sweeping trade measures.
President Trump has characterized the case as “literally, LIFE OR DEATH for our country,” arguing that without the tariffs, the U.S. would be “virtually defenseless” against nations that have long exploited trade deficits.
The administration contends that the tariffs were essential to boost domestic manufacturing and create jobs while reducing the trade deficit. Recent data indicates a significant narrowing of the U.S. trade deficit with China during September, declining by $4.0 billion to $11.4 billion as Chinese imports fell and U.S. exports rose.
However, Chinese Premier Li Qiang, the second-most powerful leader in the Chinese Communist Party after President Xi Jinping, has stated that global trade tariffs have dealt a “severe blow” to the world economy. Chinese customs data reveals a 28.7 percent year-on-year drop in exports to the United States during November.
