Tariff Update!

Last week, during his State of the Union address, President Trump told Congress that he would not seek new legislation to implement additional tariffs, following the Supreme Court’s decision striking down tariffs imposed under the International Emergency Economic Powers Act (IEEPA). He claimed that he still has “time-tested and approved” authority to issue tariffs under other statutes.

The President has not yet signed a directive to raise the Section 122 tariffs from 10% to 15%, which took effect last Tuesday. Reportedly, the White House is exploring ways to increase the rate while honoring existing trade agreements. Some major trading partners, such as the EU and the UK, have expressed concern that their negotiated rates could be affected by a blanket 15% tariff. U.S. Trade Representative Jameison Greer emphasized that the administration will take time to implement a new tariff system that ensures continuity and respects current rate agreements.

Additionally, the administration is considering legal strategies to keep the revenue from the IEEPA tariffs. One proposal is to argue that the payments are valid under the new tariff regime or allow companies to expedite refunds in exchange for forfeiting part of the money.

Meanwhile, Democratic lawmakers in both chambers have introduced bills calling for tariff refunds. For example, Senate Finance Committee Ranking Member Ron Wyden (D-OR) and 23 other Democrats introduced a bill requiring Customs and Border Protection to refund all IEEPA tariffs, with interest, even if the duty has already been finalized. Rep. Horsford (D-NV) and more than 40 other Democrats introduced similar bills in the House (H.R. 7736, H.R. 7615).