Docket 24-1287
Trump
DecidedFeb 20, 2026
6-3decision
Source: CourtListener.
Supreme Court rules IEEPA does not authorize the President to impose tariffs
What it does
The Court held that IEEPA's grant of authority to "regulate . . . importation" does not include the power to impose tariffs, because the word "regulate" does not ordinarily encompass taxation, and Congress has never used that word to delegate taxing power in any other statute. The ruling invalidates the tariffs President Trump imposed under IEEPA — including tariffs on goods from Canada, Mexico, China, and all other trading partners — because they lacked statutory authorization. The Court declined to define the full outer limits of what the President may do under IEEPA's "regulate importation" language, leaving that question for future cases.
Who benefits
Importers of foreign goods — including small businesses and larger companies — who were required to pay IEEPA tariffs and may now be entitled to refunds. States and businesses that challenged the tariffs as unlawful also prevail.
Who is affected
The President and the executive branch lose the ability to impose tariffs under IEEPA, and must instead rely on other statutes — such as the Trade Expansion Act of 1962 or the Trade Act of 1974 — which carry additional procedural requirements and substantive limits. Trade agreements and negotiations that were premised on the IEEPA tariffs face potential uncertainty.
Practical impact
All tariffs imposed by President Trump under IEEPA — including the 25% tariffs on most Canadian and Mexican goods, the tariffs on Chinese goods (which reached an effective rate of 145%), and the "reciprocal" tariffs of at least 10% on imports from all trading partners — are invalidated, and the government may be required to refund billions of dollars already collected from importers. Going forward, the President must use other statutory authorities to impose tariffs, such as Section 232 of the Trade Expansion Act of 1962 or Sections 201 and 301 of the Trade Act of 1974, each of which requires additional procedural steps — such as agency investigations, public hearings, and findings — before tariffs can take effect. Trade deals and negotiations that were conducted using the IEEPA tariffs as leverage may face legal and diplomatic uncertainty.
Majority — Roberts
Joined by: Sotomayor, Kagan, Gorsuch, Barrett, Jackson
The majority held that the power to impose tariffs is "very clearly a branch of the taxing power," which the Constitution vests exclusively in Congress, and that the President conceded he has no inherent peacetime authority to impose tariffs on his own. The Court reasoned that the word "regulate" — as ordinarily used and as Congress consistently uses it throughout the U.S. Code — means to control, direct, or govern by rule, and does not include the power to tax; the Government could not identify a single other statute in which "regulate" was understood to authorize taxation. The Court further noted that when Congress has delegated tariff authority in the past, it has always done so explicitly — using words like "duty" or "surcharge" — and with strict caps on rates, time limits, and procedural requirements, none of which appear in IEEPA. Three Justices (Chief Justice Roberts, Justice Gorsuch, and Justice Barrett) additionally applied the "major questions doctrine" — a principle requiring clear congressional authorization before courts will read ambiguous statutory language as delegating extraordinary power to the executive — finding that the economic and political stakes here (projected tariff revenues of trillions of dollars, affecting every trading partner) dwarfed those of any prior major questions case. Three other Justices in the majority (Justices Kagan, Sotomayor, and Jackson) agreed IEEPA does not authorize tariffs based solely on ordinary statutory interpretation, without invoking the major questions doctrine, reasoning that the text, structure, and Congress's consistent practice of delegating tariff power with explicit language and tight constraints all point to the same conclusion.
Dissent reasoning
The principal dissent, written by Justice Kavanaugh and joined by Justices Thomas and Alito, argued that the broad power to "regulate . . . importation" plainly encompasses tariffs as a matter of ordinary meaning, history, and precedent — because tariffs are, and have always been, one of the most traditional and common tools used to regulate imports, alongside quotas and embargoes. The dissent pointed to President Nixon's 1971 tariffs, which were imposed under IEEPA's predecessor statute using identical "regulate . . . importation" language and upheld in court, and to the Supreme Court's 1976 Algonquin decision, which unanimously held that a similarly worded statute authorizing the President to "adjust the imports" permitted monetary exactions on foreign oil — meaning Congress enacted IEEPA in 1977 with full awareness that such language covered tariffs. The dissent argued the major questions doctrine does not apply here for two independent reasons: first, because the statutory text, history, and precedent provide the "clear congressional authorization" the doctrine demands, making tariffs under IEEPA anything but an "unheralded" power; and second, because courts have never applied the major questions doctrine in the foreign affairs and foreign trade context, where Congress has historically granted the President broad discretion. Justice Thomas wrote separately to argue that the nondelegation doctrine — which limits Congress's ability to hand its legislative powers to the executive — does not apply to the tariff power at all, because regulating foreign commerce was historically treated as a prerogative (executive-type) power rather than core legislative power, and importing goods is a privilege rather than a right, meaning Congress may freely delegate tariff authority to the President without constitutional constraint.
Constitutional question
Does the International Emergency Economic Powers Act (IEEPA) authorize the President to impose tariffs on imports from foreign countries by granting him the power to "regulate . . . importation"? The Court also considered whether the major questions doctrine — which requires clear congressional authorization for extraordinary executive actions — applies to this assertion of tariff power.
Precedent changed
The Court declined to overrule any prior precedent, but distinguished and declined to extend Federal Energy Administration v. Algonquin SNG, Inc., 426 U.S. 548 (1976), which had upheld presidential "license fees" on oil imports under a differently worded statute (Section 232 of the Trade Expansion Act of 1962) that explicitly referenced "duties" and contained broader discretion-conferring language than IEEPA.