Trump Faces Major Setback as Federal Court Strikes Down Global Tariff
Washington, May 8: President Donald Trump has suffered a significant setback as the U.S. Federal Trade Court declared his announcement of a global tariff illegal and has ordered its cancellation.
The president had announced a 10% global tariff, but the court ruled that the Trump administration violated its authority under a 1974 trade law.
In a 2-1 majority decision, the Federal Court stated that the Trump administration could not impose tariffs based on broad trade and current account deficits, as the law was designed to address specific ‘balance of payments’ crises related to the international monetary system of the 1970s, not modern trade deficits.
Judges Mark A. Barnett and Claire R. Kelly noted that Trump’s announcement failed to prove that the necessary conditions under the law were met. It is important to mention that President Trump implemented these tariffs in February.
Earlier this year, the Supreme Court also struck down a previous tariff arrangement by President Trump. The new tariffs were announced under Section 122, which allows for a temporary import surcharge of up to 15% for 150 days.
The court emphasized that the administration cited current account and trade deficits instead of ‘balance of payments deficits,’ while Congress intended for this provision to be used only in limited circumstances. The judges warned that accepting such a broad interpretation would effectively grant the president unlimited authority to impose tariffs.
Judge Timothy Stanciu dissented, arguing that the court should not question the president’s economic decisions or narrowly define how balance of payments deficits are measured.
Currently, an appeal against this court decision can be made to the U.S. Federal Circuit Court of Appeals, and the case may eventually reach the Supreme Court again.
Bhupendra Singh Chundawat is a seasoned technology journalist with over 22 years of experience in the media industry. He specializes in covering the global technology landscape, with a deep focus on manufacturing trends and the geopolitical impact on tech companies. Currently serving as the Editor at Udaipur Kiran, his insights are shaped by decades of hands-on reporting and editorial leadership in the fast-evolving world of technology.