WASHINGTON, UNITED STATES – The US Supreme Court struck down former President Donald Trump’s IEEPA tariffs, prompting a rapid shift to a new 15 percent surcharge on imports under a different legal basis.
Supreme Court strikes down IEEPA tariffs
On 20 February 2026, the US Supreme Court ruled by six votes to three that Trump’s tariffs based on the International Emergency Economic Powers Act (IEEPA) were unconstitutional. The court found that the 1977 emergency law did not authorize the president to impose customs duties.
Trump described the ruling as “deeply disappointing” and publicly vented anger at two of his own Supreme Court nominees.
“Deeply disappointing,”
said Donald Trump, former US president, who announced the same day that he would replace the overturned charges with a new legal basis and followed through within hours.
New Section 122 proclamation raised to 15%
On 20 February, Trump signed a proclamation under Section 122 of the Trade Act of 1974, initially adding a 10 percent surcharge. On 21 February he increased this via a Truth Social post to 15 percent, the maximum allowed by law.
The new tariff surcharge took effect on 24 February 2026 at 12:01 a.m. Washington time and applied to imports from all countries worldwide. It generally came on top of existing duties, with one major exception relating to Section 232 measures.
Time-limited powers and automatic expiry
Section 122 allowed the president to impose temporary tariffs of up to 15 percent in cases of “substantial balance-of-payments deficits.” The measure was set to expire automatically after 150 days, with an end date of 24 July 2026.
Any extension beyond that date would have been possible only with the approval of Congress, and it remained unclear whether the necessary majority would materialize. Trading partners watched closely as the clock ticked on the temporary regime.
Raw materials, precious metals and energy exempt
Certain critical minerals and metals used as currency or traded as bullion were excluded from the surcharge. The same applied to energy and energy products traded on international commodity markets.
The list of exemptions largely mirrored that of the overturned IEEPA tariffs. Exporters were warned not to assume automatic carryover, as precise classification was based solely on HTS codes, not on general product descriptions.
Agricultural goods, pharmaceuticals and electronics
Natural resources and fertilizers not sufficiently producible in the United States were also exempt, as were selected agricultural products including beef, tomatoes and oranges. These goods did not face the new surcharge.
Pharmaceuticals, active pharmaceutical ingredients and certain electronics likewise remained outside the scope of the extra duty. These categories had already been exempt under the IEEPA tariffs, with detailed boundaries set out in Annex I of the new proclamation.
Vehicle-related exemptions and industry impact
The surcharge did not apply to specific passenger vehicles, light and heavy commercial vehicles, buses and selected vehicle parts. Annex I and II defined which particular models and components were covered.
Automakers and suppliers were urged to check the HTS codes of their products carefully before assuming an exemption. The White House explicitly stated that general goods descriptions were insufficient for determining eligibility.
Aviation, books and baggage outside the new duty
Certain aerospace products were also excluded, including, according to the proclamation, parts of civilian aircraft. In addition, informational materials such as books, humanitarian donations and accompanied baggage of arriving travelers were not subject to the surcharge.
For the aviation industry, the exemptions could have significant financial effects, given the high unit values of aircraft parts. Companies in the sector were nonetheless advised to verify whether their goods truly fell under the specified HTS positions.
USMCA, CAFTA-DR and regional carve-outs
Goods from Canada and Mexico that met USMCA agreement requirements were not subject to the new surcharge. The same treatment applied to duty-free textiles and clothing originating in the CAFTA-DR countries.
The CAFTA-DR states covered by this rule were Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua. Special provisions also applied to products already facing tariffs under Section 232, particularly in metals.
Narrow four-day window for goods already at sea
For cargo loaded onto a vessel and already en route by 12:01 a.m. US East Coast time on 24 February 2026, a tightly framed transition rule applied. These shipments could still be cleared for free circulation by 12:01 a.m. on 28 February 2026.
To benefit, importers had to file customs declarations or remove goods from a bonded warehouse by the deadline. Missing this narrow window meant paying the full surcharge, with no leeway for delays.
HTS codes as decisive legal reference
The White House emphasized that exemptions were determined exclusively via the Harmonized Tariff Schedule of the United States (HTSUS). The exact scope of coverage was defined in Annex I and II of the proclamation.
Technical details were to be published via the Federal Register. Exporters who misclassified their goods risked unexpected back payments, making a prior review of HTS codes advisable, ideally with support from specialized customs advisers.
No double charging with Section 232 duties
In principle, the Section 122 surcharge was levied in addition to existing US tariffs. One central exception stated that goods already subject to Section 232 duties would not be charged twice.
For products where Section 232 applied only to part of the import—such as certain aluminium or steel items—the Section 122 surcharge was imposed only on the portion not covered by Section 232. This split treatment required careful assessment by affected companies.
Refunds for IEEPA tariffs still unresolved
Following the Supreme Court’s ruling, US importers became entitled to refunds of IEEPA tariffs paid since February 2025. Estimates pointed to a total of more than 160 billion US dollars potentially at stake.
The government had not yet set out how these repayments would be processed. Importers could file appeals but needed to observe the relevant deadlines, and experts strongly advised seeking legal counsel before making decisions.