Supreme Court rules Trump's tariffs illegal

This is one of the most significant cases that the justices have decided in recent years here. The Supreme Court ruling that President Trump's use of these emergency tariffs that he has implemented are illegal. It's the most significant economic case to reach the high court in years, sweeping implications for the economy and of course for presidential power.

And at stake here are billions of dollars in revenue that have already been collected by the government. Pamela wolf. The other significance here is that this is the first time that the 63 conservative court has ruled against President trump in one of these major cases that have gone before the court since he returned to power in january. Now we are still going through this case, but this is so waiting for. The court sa

up this case on an expedi deciding even though it's now because of course thi So as we go through this team, another outstanding now happens to all that r

collected. This is someth clear from the arguments what they would say about that if they're going to lay out a plan. So we will continue to go through this. But this is an enormous decision and a rare loss for President Trump before this conservative

court.

This is, Paula, a major slap at the president of the United States who has made a major effort over these many, many months to impose all of these tariffs. And just to look at some of the background I have here, over these many months, the administration has collected $150 billion in these tariffs. So what happens to that money? Do they have to refund that money to the firms, to the people who paid for those tariffs?

That's one of the big questions that came up at arguments, and it's something that we are looking through now in this opinion. The top line is that these are illegal, that the president cannot rely on this 1977 emergency law to impose tariffs without authorization from Congress, because this question is really about the extent of presidential power. And we know in both his terms in office, President Trump has really worked at the edges of what

has largely been recognized as executive authority. But in these arguments back in November, they went on for two and a half hours, it was clear that the justices were skeptical that President Trump could rely on this vague federal law to impose global tariffs. Now, they did appear to likely be willing to decide that these were illegal, but what is not clear,

and we haven't gotten to this part of the opinion, is what happens to all that revenue that has been collected by the government. And President Trump has said himself that this is a massive decision for him, so we're waiting for reaction,

both from the Justice Department that argued this on his behalf, and also from the White House. But we're going to keep going through this, Wolf, to try to see if the justices laid out any plan for what happens to that revenue.

All right, Paula, stand by. I know you're going to be reading all these opinions and everything. I want to get back to you. But I want to bring in our senior legalback for the president of the United States. And this has been a traditionally conservative Supreme Court. But they ruled that all of these tariffs that Trump has imposed over these many months are illegal.

It's a big deal.

Well, Wolf, it's a monumental ruling. And the bottom line is that the tariffs Donald Trump announced back in April on Liberation Day are gone. They have been ruled illegal by this U.S. Supreme Court. An interesting array of justices here. In the majority, ruling that the tariffs are illegal is Chief Justice Roberts, Justice

Gorsuch and Justice Amy Coney Barrett, three conservatives who teamed up with the three liberal justices, Sotomayor, Kagan and Jackson, to rule these tariffs unconstitutional. The dissenters are Justices Thomas, Alito, and Kavanaugh. And the basis for the ruling is this. Congress, not the president, Congress typically holds the tariff power. Now Congress passed this law back in 1977 called the International Economic Emergencies

Act. And Donald Trump tried to use that law to say, well, I'm declaring an international economic emergency, therefore I'm imposing tariffs. But the majority here said, no, that law does not authorize you to impose tariffs. And no, there is not a valid international economic emergency here. So the end result, and we are still going through this, but the end result is that Donald

Trump's tariffs have been struck down by the U.S. Supreme Court. But really important point I want to make, Donald Trump has said, various White House officials have said, if he loses on this basis, he will try to re-implement other tariffs through other laws, which he can try to do. However, those other laws are much more restrictive. They would not allow him to apply the type of sweeping, massive, across the globe tariffs

that he tried to impose here, but have now been struck down. Look, Donald Trump said these tariffs are the single most important thing he has done in his presidency. He said that, and now they've been struck down by the court.

So you're right. The administration has made clear that if the court strikes this down, that they'll look at other tariff authorities to use. But bottom line here, Ali, how big of a mess does this ruling create given the fact that that the administration says it has already received received $150 billion in revenue largely paid for by American businesses. Do they get a refund? What

happens now? Yeah, so it's hard to think of a case that has broader implications politically and legally and economically than this one. I know a lot of people are watching for this one. We don't yet have the answer. This was a question as that came up during the oral argument. Amy Coney Barrett in particular asked the lawyers, well, what do we do with the hundred plus billion dollars that have already been paid by American importers, by American manufacturers? We're going to

look carefully at this. I know Paul is reading this very carefully, but that's a huge question. Will there be some sort of mass refund program? Will the court rule that the tariffs are dead from here on out, but there are no repayments? We will let you know as soon as we get an answer to that one.

All right. As you noted, Paula has been reading through the opinion. I want to go back to Paula Reed because we know that three conservatives sided with the liberals on the court and you have a quote from one of those conservatives, right Paula? That's right, well this is Chief Justice John Roberts who wrote the majority opinion where the court agreed six to three that President Trump's tariffs exceed his power under the law.

He wrote, quote, "'The President asserts the extraordinary power "'to unilaterally impose tariffs of unlimited amount, "'duration, and scope. "'In light of the breadth, history, "'and constitutional context of that asserted authority. He must identify clear congressional authorization to

exercise it. And we knew that the chief justice would be a key vote after what we saw at arguments. Now we are still going through this. I want to show you this is about a third of the opinion. It's 170 pages long. This is just a fraction of it. So we're going through it very carefully to try to understand what, if anything, the court said about what happens to all that revenue the government has already collected. I know that's a big question. Right

now we are carefully going through this to see if they laid out a plan, if this goes back to the lower courts. That's what we're working to figure out right now.

And quick question from me, Paula. Do the tariffs immediately go away as of right now, or does it take a few days or at least maybe a few weeks for them to be removed?

Well, they've been declared by the Supreme Court to be illegal, so we're going through to see if they laid out some sort of plan, but as of right now, people should not have to pay a tariff today or tomorrow, one would think. But we're looking to see, because the logistics of this are so complicated, to see if the justices waded into that, or if all of that is going to be something that's now going to be tossed down to lower courts, now that the justices have ruled on the larger constitutional question here,

the separation of powers, and who has the authority to do this. Because while this has enormous economic implications, really this was a question about the extent of executive power. We know President Trump really plays at the edges of that. And again, this is a rare loss for President Trump since he has returned to office before this conservative court.

before this conservative court. So we're going to keep waiting through what they said to work out the details.