Washington, May 8: The U.S. Federal Trade Court has dealt a significant blow to President Donald Trump. The court ruled that Trump’s global tariff announcement is illegal and has decided to overturn it.
President Trump had announced a 10% global tariff. In its ruling, the court stated that the U.S. administration violated its authority under a 1974 trade law.
In a 2-1 majority decision, the Federal Court indicated that the Trump administration cannot impose tariffs based on broad trade and current account deficits using Section 122 of the 1974 Trade Act. The court clarified that this law was designed to address specific ‘balance of payments’ crises linked to the international monetary system of the 1970s, not modern trade deficits.
Judges Mark A. Barnett and Claire R. Kelly noted that Trump’s announcement failed to demonstrate that the necessary conditions under the law were met. It is worth mentioning that President Trump imposed these tariffs in February.
Earlier this year, the Supreme Court also annulled Trump’s previous tariff arrangements. The new tariffs were announced under Section 122, which allows for a temporary import surcharge of up to 15% for 150 days.
The court stated that the administration referenced current account deficits and trade deficits instead of ‘balance of payments deficits,’ while Congress intended to use this provision only in limited circumstances back in 1974. The judges warned that accepting such a broad interpretation would effectively grant the president unlimited authority to impose tariffs.
Judge Timothy Stanciu stood in support of President Trump’s announcement. He argued that the court should not question the president’s economic decisions nor narrowly define how balance of payments deficits should be measured.
Currently, an appeal against this court decision can be filed in the U.S. Federal Circuit Court of Appeals, and the case may eventually reach the Supreme Court again.
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My name is Narendra Jijhontiya. I am an experienced content writer with several years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including TECHNOLOGY, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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