The US Supreme Court is set to hear arguments today regarding the legality of tariffs imposed by former President Donald Trump, a decision that could significantly impact both the US economy and global trade. The case revolves around Trump's use of the International Emergency Economic Powers Act (IEEPA) of 1977, which allows the president to take economic actions during national emergencies. Critics argue that this law does not grant the president the authority to impose tariffs, a power traditionally held by Congress.

Lower courts have previously ruled that Trump exceeded his authority under the IEEPA when he imposed tariffs on imports from various countries, including China, Canada, Brazil, and India. The case, Learning Resources, Inc. v. Trump, combines multiple lawsuits from affected businesses and 12 states, primarily led by Democrats, challenging the legitimacy of these tariffs.

Neal Katyal, the attorney representing the challengers, stated, "The idea that every president had this power all along... is just too fanciful to believe." He emphasized that the Constitution reserves the power to tax and set tariffs for Congress, not the president. Legal experts are divided on the likely outcome, with some predicting a ruling against the tariffs, while others believe the Court may side with the administration.

Trump has defended the tariffs as necessary for national security and economic stability, arguing that they address trade imbalances and the flow of fentanyl into the US. Treasury Secretary Scott Bessent has warned of potential "massive refund" obligations, estimating costs between $750 billion and $1 trillion if the tariffs are struck down. He also indicated that the administration has alternative legal strategies to impose tariffs if the Court rules against them.

The Supreme Court's decision is expected to have far-reaching implications, potentially reshaping the balance of power between Congress and the presidency regarding trade policy. Observers note that the Court's ruling could influence trillions of dollars in US revenues over the next decade, making this case a critical test of executive authority and US trade relations. Oral arguments are scheduled to begin at 10 a.m. ET, with many closely watching the proceedings for their potential impact on the future of US trade policy.