{"id":7384,"date":"2026-02-20T20:41:52","date_gmt":"2026-02-20T20:41:52","guid":{"rendered":"https:\/\/www.rbc.com\/en\/economics\/?p=7384"},"modified":"2026-04-03T00:03:53","modified_gmt":"2026-04-03T00:03:53","slug":"us-supreme-court-ruling-does-not-mean-tariffs-are-going-away","status":"publish","type":"post","link":"https:\/\/www.rbc.com\/en\/economics\/us-analysis\/us-featured-analysis\/us-supreme-court-ruling-does-not-mean-tariffs-are-going-away\/","title":{"rendered":"US Supreme Court ruling does not mean tariffs are going away"},"content":{"rendered":"\n
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The decision of the Supreme Court of the United States on February 20, 2026 to strike down the U.S. administration\u2019s use of the International Economic Emergency Powers Act (IEEPA) to impose sweeping tariffs represents a significant challenge to the government\u2019s trade policies, and raises immediate questions about refund obligations, potential Congressional action, and alternative tools for enforcing tariffs.<\/p>\n\n\n\n

All of these are unknown at the time of writing as the ruling invalidates the legal foundation for duties that had collected more than $130 billion to date.<\/p>\n\n\n\n

Importantly, this decision could have near-term consequences for inflation\u2019s path in 2026\u2014the extent will depend on how the administration responds in the weeks ahead.<\/p>\n\n\n\n

The Supreme Court decision may appear to be a major blow to the administration\u2019s tariff policies, but its trade agenda can be pursued through other avenues.<\/p>\n\n\n\n

IEEPA was used as the basis for a majority of Liberation Day tariffs, but other acts have been used by this government (and others) to impose tariffs on US imports.<\/p>\n\n\n\n

For example, tariffs enacted under Section 232\u2014which targets products based on national security grounds\u2014remain in place, and the administration could use this as a roadmap to cover additional sectors. The downside to Section 232 is it limits the ability of the administration to focus on country-specific trade imbalances.<\/p>\n\n\n\n

There is also a risk to existing trade agreements that offer carve outs for existing Section 232 tariffs, and could put greater focus on the USMCA review in July.<\/p>\n\n\n\n

Still, the administration has completed or started the necessary studies to invoke additional tariffs under Section 232 for the following sectors:<\/p>\n\n\n\n

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There are other ways in which the administration could apply new tariffs, which we have outlined below. <\/p>\n\n\n\n

Please keep in mind that as economists, we are not in the business of interpreting legal frameworks. In what follows, we have done are best at interpreting historic trade legislation, and these appear to be the administration\u2019s most likely options:<\/em><\/p>\n\n\n\n