Kavanaugh Dissent Gives Trump a Tariff Workaround to All-But Undo SCOTUS Ruling

In a consequential 6–3 decision Friday, the Supreme Court ruled that President Donald J. Trump’s use of emergency powers under the International Emergency Economic Powers Act (IEEPA) does not authorize the imposition of tariffs. But in a pointed dissent, Justice Brett Kavanaugh made clear that the Court’s ruling may do little to slow the administration’s broader trade strategy.

President Trump had invoked IEEPA — a 1977 statute — in April to address what his administration described as a record $1.4 trillion trade deficit in 2024. The Court, however, concluded that while IEEPA grants the executive authority to regulate certain foreign economic transactions during national emergencies, it “does not authorize the President to impose tariffs.”

Chief Justice John Roberts authored the majority opinion, joined by Justices Amy Coney Barrett, Neil Gorsuch, and the Court’s three liberal members: Justices Sonia Sotomayor, Elena Kagan, and Ketanji Brown Jackson.

Kavanaugh, joined by Justices Samuel Alito and Clarence Thomas, dissented — and in doing so, signaled that the administration has multiple alternative paths forward.

“Although I firmly disagree with the Court’s holding today, the decision might not substantially constrain a President’s ability to order tariffs going forward. That is because numerous other federal statutes authorize the President to impose tariffs and might justify most (if not all) of the tariffs at issue in this case—albeit perhaps with a few additional procedural steps that IEEPA, as an emergency statute, does not require.”

He continued:

“Those statutes include, for example, the Trade Expansion Act of 1962 (Section 232); the Trade Act of 1974 (Sections 122, 201, and 301); and the Tariff Act of 1930 (Section 338). In essence, the Court today concludes that the President checked the wrong statutory box by relying on IEEPA rather than another statute to impose these tariffs,” he argued.

Billions at Stake

Kavanaugh warned that the practical effects of the ruling could be significant in the short term.

“In the meantime, however, the interim effects of the Court’s decision could be substantial. 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. As was acknowledged at oral argument, the refund process is likely to be a ‘mess.’

“In addition, according to the Government, the IEEPA tariffs have helped facilitate trade deals worth trillions of dollars—including with foreign nations from China to the United Kingdom to Japan, and more. The Court’s decision could generate uncertainty regarding those trade arrangements.

“In any event, the only issue before the Court today is one of law. In light of the statutory text, longstanding historical practice, and relevant Supreme Court precedents, I would conclude that IEEPA authorizes the President to ‘regulate . . . importation’ by imposing tariffs on foreign imports during declared national emergencies.”

For calendar year 2025, the Trump administration collected $287 billion in tariff revenue — a 192 percent increase over the prior year — according to data from the Federal Reserve Bank of Richmond. The administration has credited those revenues as one contributing factor behind a reported $600 billion reduction in the federal budget deficit during 2025, as noted by National Economic Council Director Kevin Hassett.

Alternate Legal Authorities Ready

Even before the Court handed down its decision, reports indicated the administration had contingency plans in place.

“Nobody thinks the tariffs are going away,” Ted Murphy, a trade lawyer at Sidley Austin in Washington, said in the Financial Times report. “They are just going to be reissued under a different umbrella. They will reissue tariffs the same day.”

The Financial Times outlined several statutory options available to the administration, many of which were referenced directly in Kavanaugh’s dissent.

One avenue is Section 232 of the Trade Expansion Act of 1962 — a national security provision previously used to levy tariffs on steel, aluminum, automobiles, copper, and lumber. Ongoing Section 232 investigations reportedly involve semiconductors, pharmaceuticals, critical minerals, and aerospace components.

Another potential tool is Section 122 of the Trade Act of 1974, which allows for tariffs of up to 15 percent for 150 days as a temporary measure.

Meanwhile, “A separate provision, Section 338 of the Tariff Act of 1930, could also be triggered, although it has been used very rarely in recent history. It allows the government to immediately issue levies of up to 50 per cent on a foreign country that discriminates against US commerce, and can be used to respond to any ‘unreasonable charge, exaction, regulation, or limitation,’” the Financial Times noted.

The outlet also reported that a ruling against the administration could unsettle the Treasury bond market, as investors anticipate potential increases in federal borrowing if tariff revenue declines in the short term.

A Strategic Pause — Not a Retreat

While critics portray the ruling as a setback, Kavanaugh’s dissent suggests the Court’s decision may hinge more on statutory mechanics than constitutional limitations. If so, the administration’s broader “America First” trade doctrine remains very much alive — simply redirected through alternative legal channels.

As President Donald J. Trump continues his second term with a renewed emphasis on trade reciprocity and domestic manufacturing, the battle may now shift from the courtroom to the statutory toolbox Congress has already provided.

If Kavanaugh’s reading proves correct, this ruling may not mark the end of aggressive tariff policy — only the beginning of its next phase.