In US Tariff Ruling, How the Judiciary Drew the Red Line, The Landmark Learning Resources v. Trump Decision
Learning Resources Inc. is a small business in Illinois that imported educational toys from China. It filed a suit in the US District Court for the District of Columbia challenging the imposition of tariffs. Another small business joined this litigation. Meanwhile, five other small businesses and 12 states filed suits before the United States Court of International Trade challenging the tariffs.
These cases eventually led to the landmark 170-page ruling in Learning Resources Inc. v. Donald J. Trump on February 20, 2026. By a majority of 6-3, the tariffs imposed by President Donald Trump were held unconstitutional.
The Legal Framework
The International Emergency Economic Powers Act (IEEPA) was enacted in 1977 and sections 1701 and 1702 give the President wide powers to, among other things, investigate, regulate, nullify, prevent or prohibit any acquisition or transportation or importation or exportation of any property in which any foreign country or a national thereof have an interest. But this power can be exercised only when there is a declaration of a national emergency under the National Emergency Act.
Soon after assuming office, Trump declared a national emergency to address two foreign threats. The first was the influx of illegal drugs from Canada, Mexico and China and the second was the “large and persistent trade deficits” that had led to the hollowing out of the American manufacturing base and the undermining of critical supply chains.
To address the second threat, Trump first imposed a duty of 10 per cent on all imports from all trading partners. Several nations suffered higher tariffs, which were frequently increased, reduced or modified. On Chinese goods, for example, the tariffs were increased to 20 per cent and then to 34, 84 and finally to 125 per cent. Similarly, multiple tariff rates were repeatedly imposed on various countries, including India.
The Core Constitutional Question
The single question in this historic case was whether the power to “regulate” the importation of goods included a power to impose tariffs. Chief Justice John Roberts and five other judges ruled that sections 1701 and 1702 did not confer power on the President to impose tariffs or duties.
The Court referred to Article I, section 8 of the US Constitution, which provides: “The Congress shall have Power to lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States.”
The Constitution did not grant any taxing power to the executive branch, that is, the President; this power vested solely with Congress. The majority opinions contain a detailed discussion on the powers of the President even during a national emergency. They hold that the word “regulate” will not include the power to impose tariffs and the IEEPA had never been used to impose them since its inception.
The Government’s Arguments
The government pleaded serious economic and political consequences if the tariffs were held unconstitutional. The tariffs were expected to reduce the national deficit by $4 trillion and the amount involved in various international agreements could extend to $15 trillion. The question of whether the US would be a rich or poor nation was hanging in the balance and these staggering amounts dwarfed all earlier precedents.
The majority was unmoved by these arguments of fear and held that, in the absence of clear authority by Congress, the President could not use his emergency powers to impose tariffs. Indeed, Chief Justice Roberts applied the “major questions doctrine” that requires the executive to have clear authorization by Congress when dealing with issues that have far-reaching economic and political consequences.
The Dissent
The three dissenting judges held that the power to “regulate” importation of goods would include the power to impose tariffs, particularly during a declared national emergency. The power of regulation must be broadly construed and will include the imposition of quotas, embargoes and tariffs. It referred to earlier tariffs imposed by presidents Richard Nixon and Gerald Ford.
The leading minority judgment of Justice Brett Kavanaugh forms 63 pages of the 170-page verdict and has referred to past tariffs imposed by presidents from Abraham Lincoln onwards. The majority, however, pointed out that those were different statutes that enabled the President to act during wartime. On the other hand, the tariffs by Trump were levied at a time of peace. The majority remarked that the US was not at war with every nation in the world.
The Aftermath
Justice Kavanaugh notes that this historic ruling may not constrain Trump’s power to impose tariffs in the coming months. He has referred to at least three federal statutes that enable such imposition: Section 232 of the Trade Expansion Act of 1962, sections 122, 201 and 301 of the Trade Act of 1974, and section 338 of the Tariff Act of 1930.
The minority judgment has pointed out that holding the tariffs unconstitutional would result in substantial refunds and lead to a “mess”. The government would have to return billions of dollars collected under the now-invalid tariffs.
The Significance
This ruling is significant for several reasons. First, it reaffirms the constitutional principle that the power to tax belongs to Congress, not the executive. Second, it limits the president’s ability to use emergency powers for purposes not clearly authorized by statute. Third, it applies the major questions doctrine to require clear congressional authorization for actions with vast economic consequences.
For India and other trading partners, the ruling creates uncertainty. The tariffs that were challenged have been struck down, but new tariffs under different statutory authorities may be imposed. The underlying policy tensions remain.
Conclusion: A Red Line Drawn
The Supreme Court drew a red line. The president cannot use emergency powers to impose tariffs without congressional authorization. Arguments of economic necessity cannot override constitutional limits. The power to tax is the power to destroy, and that power belongs to the people’s representatives, not to a single executive.
Whether this ruling will be the last word on Trump’s tariffs remains to be seen. New tariffs under other statutes may be imposed. The legal battles may continue. But on this issue, the Court has spoken: the IEEPA does not authorize tariffs. The Constitution still matters.
Q&A: Unpacking the US Tariff Ruling
Q1: What was the core legal question in Learning Resources v. Trump?
The central question was whether the International Emergency Economic Powers Act (IEEPA), which gives the president power to “regulate” imports during a national emergency, authorizes the imposition of tariffs. The Supreme Court held 6-3 that it does not. The power to tax (including tariffs) belongs to Congress under Article I, section 8 of the Constitution.
Q2: What was the government’s main argument against striking down the tariffs?
The government argued that striking down the tariffs would have severe economic consequences—the tariffs were expected to reduce the deficit by $4 trillion, and international agreements involved up to $15 trillion. The Court was unmoved, applying the “major questions doctrine” which requires clear congressional authorization for actions with far-reaching economic effects.
Q3: What was the basis of the dissenting opinion?
The three dissenting judges, led by Justice Kavanaugh, argued that the power to “regulate” imports should be broadly construed to include tariffs, especially during a declared national emergency. They cited historical precedents of presidents imposing tariffs from Lincoln to Nixon and Ford. The majority noted those were under different statutes or during wartime.
Q4: Does this ruling end Trump’s ability to impose tariffs?
Not necessarily. Justice Kavanaugh’s dissent notes at least three other federal statutes that could authorize tariffs: Section 232 of the Trade Expansion Act 1962, Sections 122, 201 and 301 of the Trade Act 1974, and Section 338 of the Tariff Act 1930. The ruling only strikes down tariffs imposed under IEEPA; other statutory authorities remain available.
Q5: What are the practical implications of this ruling?
The government may have to refund billions of dollars in tariffs collected under the invalidated IEEPA authority. For trading partners like India, uncertainty remains—existing tariffs may be refunded, but new tariffs under different statutes could be imposed. The underlying policy tensions and trade disputes continue, now fought under different legal authorities.
