A federal appeals court has ruled that many of President Donald Trump's tariffs are unconstitutional. However, the court has allowed these tariffs to remain in place for now as the case is expected to proceed to the Supreme Court.

The U.S. Court of Appeals for the Federal Circuit determined that Trump's tariffs, particularly the so-called "Liberation Day" tariffs and those related to fentanyl, exceeded the authority granted under the national security statute he invoked. The court's 7-4 decision upholds a previous ruling from a specialized federal trade court in New York, which found that Trump did not have the legal right to declare a national emergency to impose these import taxes.

Despite the ruling, the court did not immediately strike down the tariffs, giving the Trump administration time to appeal. This decision complicates Trump's efforts to reshape U.S. trade policy unilaterally. While he has other legal avenues to impose tariffs, they would limit his ability to act swiftly and decisively.

Trump criticized the ruling, calling the court "highly partisan" and claiming it was a mistake. He warned that removing the tariffs would lead to economic disaster for the United States. The Liberty Justice Center, which represents businesses challenging the tariffs, stated that the president cannot impose tariffs independently. They argued that the ruling protects American businesses and consumers from the negative impacts of the tariffs.

The tariffs in question were justified by Trump under the 1977 International Emergency Economic Powers Act (IEEPA). The "Liberation Day" tariffs, announced on April 2, imposed reciprocal tariffs of up to 50% on countries with which the U.S. has trade deficits, along with a baseline 10% tariff on nearly all other countries. Trump claimed that the national emergency was due to the persistent trade deficit.

Additionally, the "trafficking tariffs" announced on February 1 targeted imports from Canada, China, and Mexico, aiming to address the illegal flow of drugs and immigrants. Critics argue that the trade deficit does not constitute an "unusual and extraordinary" threat necessary to justify declaring a national emergency.

The ruling could have significant implications for U.S. trade policy. If the tariffs are ultimately revoked, the government may need to refund some of the collected import taxes, which could impact the U.S. Treasury. Revenue from tariffs had reached $142 billion by July, more than double the amount from the previous year.

Legal challenges to Trump's tariffs have emerged from various businesses and states, arguing that the IEEPA does not authorize the imposition of tariffs. The court's decision reflects ongoing tensions between the executive branch's authority and congressional powers regarding trade and taxation.