Court Rules Trump's 10% Global Tariffs Unlawful

The U.S. Court of International Trade ruled in a 2-1 decision on May 7, 2026, that Donald Trump illegally imposed a 10% global tariff on most imports. The court found the administration overstepped its authority by invoking Section 122 of the Trade Act of 1974, ruling that the law is intended for specific balance-of-payments crises rather than general trade deficits. This follows a February Supreme Court decision that struck down previous tariffs imposed under the International Emergency Economic Powers Act, leaving the government owing importers approximately $175 billion in refunds.

The ruling specifically blocks tariff collection and mandates refunds for the state of Washington and two companies, Burlap & Barrel and Basic Fun!. However, the court denied a universal injunction, meaning most other importers must continue paying the duties until they expire on July 24. Judge Timothy Stanceu dissented, arguing the court lacked the macroeconomic expertise to question the president's reliance on official government statistics.

President Trump criticized the ruling and the judges involved, stating that his administration would explore alternative legal paths, such as Section 301 and Section 232 investigations, to implement new tariffs. The administration has since appealed the decision to the U.S. Court of Appeals for the Federal Circuit. Internationally, the ruling has created instability; trade experts advised India to delay a bilateral trade agreement with the U.S. due to the unpredictable trade posture.