SC Tariff Ruling Cripples Trump’s Trade Deals

In a major blow to the executive branch’s authority over global commerce, the Supreme Court (SC) handed down a 6–3 decision on Feb. 21, 2026, declaring President Trump’s sweeping use of emergency powers to impose tariffs fundamentally illegal, Nick Lichtenberg reported for Fortune.

Since Trump’s “Liberation Day,” when he enacted most of these tariffs in April 2025, the US Treasury has accumulated $240 billion in customs duty revenue.

The ruling immediately imperils the cornerstone of the administration’s economic strategy, transforming America’s negotiator-in-chief into a leader stripped of his most potent leverage.

Most of Trump’s tariffs were deployed under the International Emergency Economic Powers Act (IEEPA), which the administration used to justify a vast network of reciprocal tariffs applied to most trading partners under the pretext of a “balance of payments emergency.”

It also levied distinct, targeted tariffs against Canada, China, and Mexico, citing a “drug trafficking emergency.”

The SC’s decisive ruling concluded that using the IEEPA for these purposes was unlawful.

Since Trump’s “Liberation Day,” when he enacted most of these tariffs in April 2025, the US Treasury has accumulated $240 billion in customs duty revenue, according to Capital Economics’ chief North America analyst Paul Ashworth.

That figure represents a $180 billion increase compared with the same period in 2024.

Based on 2024 import weights, Ashworth added, the theoretical effective tariff rate soared from just 2% in 2024 to about 14%, with nine percentage points of that increase directly attributable to the now-illegal IEEPA tariffs.