Will the Supreme Court overturn Trump’s tariffs?

The fate of President Donald Trump’s trade war now rests with the nine Supreme Court justices.

The Supreme Court on Wednesday heard oral arguments in a case challenging President Donald Trump’s authority to impose double-digit tariffs on U.S. trading partners without authorization from Congress.

The case concerns the International Emergency Executive Powers Act of 1977, which Trump invoked when he imposed his broad “reciprocal” tariffs against most of the world’s countries, declaring a national emergency in the process. IEEPA tariffs account for about half of the tariff revenue collected in 2025 so far, according to economists at Deutsche Bank.

Both liberal and conservative justices investigated the administration’s arguments for imposing the tariffs, and also poked holes in counterarguments. But both sides agreed on one thing: the risks of this issue are high.

Trump posted on social media on Tuesday that “tomorrow’s United States Supreme Court case is, quite literally, life or death for our country.” “With victory, we have tremendous, but fair, financial and national security. Without it, we are effectively defenseless against other nations who have exploited us for many years.”

Lower courts ruled to strike down the definitions, although the Supreme Court allowed them to remain in place while the case was decided.

Lawyer Neal Katyal, who is defending on behalf of companies that have filed lawsuits to overturn import taxes, said the law does not allow Trump to impose tariffs, which are in effect a tax on the American people.

“It is simply unconscionable that by invoking IEEPA, Congress handed the President the power to reform the entire tariff system and the American economy in the process, allowing him to set and reset tariffs on any and every product from any country at any time,” he said.

Some justices expressed concerns that allowing the tariffs to stand would give the president too much power, and questioned whether a future liberal president could use similar “emergency” powers to declare a “climate emergency” and impose tariffs on cars or other products that emit greenhouse gases, for example.

“As a practical matter, you cannot take back that power simply by handing it over to the president,” Justice Neil Gorsuch said. “It is a one-way rise toward the gradual but continuous accumulation of power in the executive branch and away from the elected representatives of the people.”

Which way do they lean?

To some experts, the questioning suggested that the justices were leaning toward striking down at least some of Trump’s definitions. The administration can still impose tariffs through other legal channels, but these come with more restrictions, for example, requiring an investigation into unfair trade practices in other countries.

“After that argument, if I were the Trump administration, I would be burning the midnight oil over the next two weeks to come up with backup plans for tariffs,” Peter Harrell, a visiting scholar at Georgetown University Law School, said on social media.

PoleMarket prediction market gamblers were calculating a 27% chance that Trump’s tariffs would stand, leaving a significant amount of uncertainty about the outcome of the case. The ruling could come in December, Bank of America analysts said in a research note.

“Certainly, it seems possible that the Supreme Court will issue an opinion holding that the IEEPA tariffs exceeded the authority of President Trump, consistent with the powers of lower courts,” trade expert Dave Townsend, a partner in the international trade group of law firm Dorsey & Whitney, wrote in a commentary. “However, it is unclear which direction the Supreme Court is heading in its final opinion.”

The case has major implications for the trade wars that have rocked the economy by fueling uncertainty and damaging household budgets, as importers pass on costs to customers. It is estimated that the tariffs will cost the average family $1,800 in 2025, according to the Budget Lab at Yale University.

Eliminating tariffs could boost the economy

If the Supreme Court goes so far as to order a refund of tariffs already collected, it could provide significant relief to businesses and households that have directly or indirectly paid import taxes, Heather Long, chief economist at Maritime Federal Credit Union, wrote in a commentary.

“The tariffs were particularly burdensome for small businesses and low- and middle-income households,” she wrote. “If the Supreme Court overturns these tariffs, it would be a victory for small businesses. The government would have to return at least $100 billion, which would pump money into the economy in 2026 and boost profits for many companies.”