How Trump’s Tariffs Could Survive the Supreme Court Ruling

However, each tool has specific limitations that he will need to consider and could face additional legal challenges. Here’s a detailed breakdown of some of the main authorities that Trump will lean on to keep tariffs on his trade agenda.

Section 122: Balance of Payments Tariffs

To immediately replace his 10 percent baseline tariff, Trump announced that he would call on Section 122 of the Trade Act of 1974, which authorizes the president to address “large and serious” balance-of-payments deficits by imposing tariffs of up to 15 percent or applying import quotas. The statute requires only a presidential determination that such a deficit exists and does not mandate an interagency process or formal investigation.

Any measures imposed under Section 122 automatically expire after 150 days unless Congress votes to extend them, making the authority temporary. Assuming Trump leans on this authority in the coming days, this means that he can reimpose his tariff baseline until the end of July. Importantly, actions under Section 122 must be applied uniformly and cannot target individual countries.

In oral arguments over the IEEPA tariffs, the plaintiffs suggested that Section 122 is the appropriate authority for President Trump’s “Liberation Day” tariffs, which he argued were put in place to address “large and persistent annual U.S. goods trade deficits.” However, this authority could not replace the IEEPA trafficking tariffs against Canada, Mexico, and China, which were purportedly imposed to stem the flow of fentanyl from those countries.

While Section 122 has never been used to impose trade restrictions, it was created in response to President Richard Nixon’s 1971 use of IEEPA’s predecessor statute, the Trading with the Enemy Act (TWEA), to address balance-of-payments problems. It could therefore plausibly be invoked to apply a temporary, across-the-board tariff as short-term negotiating leverage.

It is unlikely that Congress would extend Trump’s tariff authority this year, with midterm elections around the corner. But if it did, it would give the president a few months of additional tariff revenue and negotiating leverage.

Section 232: Sectoral Tariffs

There are also trade authorities that the president has already used, which he could use to bring back some tariffs. One such law is Section 232 of the Trade Expansion Act of 1962, which authorizes the president to impose tariffs or quotas on imports deemed to threaten U.S. national security, following an investigation and recommendations by the secretary of commerce. Because the statute does not define “national security,” it grants the executive branch broad discretion in its interpretation. Trump stated that existing 232s would remain “in full force.” 

Importantly, this cannot completely replace Trump’s emergency tariffs, since these tariffs are applied by sector and do not universally apply to all products coming into the United States. However, there is no cap on the tariff rate, so Section 232 tariffs have no upper limit.

In his first term, Trump used this authority to raise tariffs on steel and aluminum. Since returning to office, he has expanded those tariffs and used this law to raise tariffs on a range of other sectors, including cars, car parts, heavy trucks and buses, copper, and lumber and wood products such as furniture and kitchen cabinets.

These tariffs apply to imports from every country, though country and specific product exemptions have been granted. Initial tariffs can also be expanded indefinitely not only in the tariff rate, but also the product coverage, which allows for derivative products to also be tariffed, such as aluminum beer cans.

Though Congress retains the ability to overturn Section 232 actions through a disapproval resolution, this has rarely been used. This is a tool readily available to Trump, and he has shown his willingness to use it.

Section 301: Unfair Trade Practices

Another law that Trump has already employed is Section 301 of the Trade Act of 1974, which authorizes the U.S. Trade Representative, at the direction of the president, to respond to unfair foreign trade practices, including violations of trade agreements or acts that are “unreasonable or discriminatory” and burden U.S. commerce. Investigations may be initiated in response to petitions from interested parties or self-initiated by the trade representative, a practice that has increased over time.

Section 301 offers a broad range of remedies and does not cap tariff levels, but it requires a formal investigative process and findings before action can be taken. Measures must be reviewed after four years, and if a domestic industry argues that it benefits from the tariffs, the trade representative can keep them in place.

During his first term, Trump launched six Section 301 investigations, but the only one that resulted in tariffs targeted China. Those tariffs are still in place. Furthermore, since the bulk of existing tariffs against China fall under this authority, losing the IEEPA tariffs does little to reduce tariffs on China.

Once imposed, Section 301 actions are difficult to unwind, as the bar to maintaining the trade action is low. For example, the Biden administration reviewed and maintained Trump’s Section 301 China tariffs, despite the majority of comments submitted by domestic industry calling for their repeal.

Section 301 tariffs also cannot completely replace Trump’s emergency tariffs because they are country-specific, but he could launch several Section 301 investigations against trading partners that have failed to negotiate trade deals with his administration, if he wants to expand existing 301 tariffs beyond China.

Section 338: Unreasonable Discrimination Tariff

Another novel statute is Section 338 of the Tariff Act of 1930, which authorizes the president to impose tariffs of up to 50 percent of a good’s value on imports from countries that unreasonably discriminate against U.S. trade through tariffs, regulations, or other measures. The statute allows action whenever the president “finds as a fact” that such discrimination exists, suggesting that a formal investigation may not be required. The president has not indicated that he will use this authority yet.

Though the statute references a “Commission”—now the International Trade Commission—it does not clearly specify whether the ITC must conduct formal fact-finding or simply monitor discriminatory practices and inform the president. This ambiguity creates legal uncertainty around how Section 338 would be implemented in practice.

Section 338 has never been used to impose trade restrictions. While a finding of discrimination occurred in 1935 against Germany and Australia, no action followed. Consequently, though an available statute, its authority remains untested.

This is not a perfect replacement for Trump’s emergency tariffs, because 338 is country-specific. However, the president could apply these tariffs to those countries that have not yet signed a deal with the United States. In any event, the use of Section 338 will almost definitely be litigated.

What Comes Next

The Supreme Court’s ruling on IEEPA takes away one tool of the president’s current trade agenda, but there are several others that the president can use to raise tariffs. However, because  there is no exact replacement for the sweeping authorities that Trump claimed under IEEPA, he will need to rebuild his tariffs in a patchwork. 

While President Trump has announced quick action in response, the Section 122 tariffs are time-limited. Therefore, he should weigh his next steps carefully—legally as well as politically. 

A recent CFR-Morning Consult poll of Americans’ views on trade and tariffs found that a plurality of Americans think that the president should not be allowed to impose tariffs without congressional approval, and support some guardrails on the president’s tariff authority. Furthermore, Americans are concerned about the trade impacts on affordability, and they view tariffs as having the most impact on consumers, the middle class, small businesses, their own household finances, and the larger economy. 

The unpopularity of the tariffs, and now, the Supreme Court’s ruling, could provide Trump a tariff offramp if he chooses to take it. He does not necessarily need to use tariffs to execute his overall trade agenda, which has been focused on negotiating deals with other countries. In fact, U.S. trading partners have been willing to come to the table to discuss U.S. trade concerns. In addition, losing the IEEPA tariffs does not eliminate the other commitments that U.S. trading partners have made in those deals, including purchase commitments, investment pledges, and regulatory coordination.

It is clear that the president has many options to choose from that would allow him to bring back his tariff agenda, but only he can decide whether it is worth continuing the economic and political uncertainty the United States and the world have faced over the past year because of it. 

This work represents the views and opinions solely of the author. The Council on Foreign Relations is an independent, nonpartisan membership organization, think tank, and publisher, and takes no institutional positions on matters of policy.