The Trump administration on Thursday finalized new double-digit tariffs on dozens of U.S. trading partners as it seeks to reconstitute sweeping duties struck down by the Supreme Court in February.
Just after midnight on Friday, dozens of countries that supply nearly everything Americans buy woke up to a new tax on their goods, the latest twist in a trade war that refuses to end even after the country’s highest court tried to stop it. The Trump administration confirmed it would impose tariffs of between 10 and 12.5 per cent on 60 trading partners, from major economies in Europe and Asia to smaller developing nations, covering goods that make up 99.4 per cent of everything the United States imports. The justification this time was not the sweeping emergency powers claim that the White House had relied on for more than a year, but a far narrower legal argument, that these countries have failed to properly enforce bans on goods made with forced labour. It is a story that looks, on the surface, like another routine trade announcement. In reality, it is the clearest sign yet that Washington’s tariff strategy has entered a new and more legally cautious phase, one shaped less by presidential instinct and more by the need to survive the next court challenge.
To understand why this matters, it helps to look back at what happened in February. The Supreme Court ruled by six votes to three that the law Donald Trump had used to impose his most sweeping tariffs, the International Emergency Economic Powers Act, never gave a president the authority to tax imports in the first place. Chief Justice John Roberts, writing for the majority, said the power to impose tariffs belonged to Congress alone, and that the law in question did not hand that power to the White House, however broadly it was read. The ruling struck down both the so called fentanyl tariffs imposed on Canada, Mexico and China, and the much wider reciprocal tariffs announced on what the administration called Liberation Day, arrangements that together had made up around seventy per cent of the entire American tariff system. For a president who had built much of his economic and foreign policy around the threat and use of tariffs, it was a serious constitutional setback, and one that sent a jolt through financial markets and foreign capitals alike.
The administration’s response revealed just how central tariffs had become to its approach to the rest of the world. Within days of the ruling, Trump turned to a different and much older law, Section 122 of the Trade Act of 1974, which allows a president to impose a temporary tariff of up to fifteen per cent to address a balance of payments problem, but strictly limits how long such a tariff can last. He used it to impose a flat ten per cent tariff on almost all imports, a stopgap measure that was always going to expire, and which finally ran out at the stroke of midnight on Friday. That built in expiry date is what forced this week’s announcement. Rather than allow tariffs to disappear entirely and hand trading partners a clean slate, officials moved quickly to replace the emergency measure with something narrower but, in their view, more durable in court.
Forced labour became the new legal vehicle
The choice of justification is telling. Rather than invoking a national emergency, the administration is now leaning on the argument that dozens of countries have not done enough to stop goods produced through forced labour from entering global supply chains. The United States trade representative, Jamieson Greer, said the country had maintained a ban on such imports for close to a century and rigorously enforced it, and argued it was time for trading partners to do the same. Analysts following the case closely say the legal logic is deliberate, since forced labour enforcement sits on firmer statutory ground than the emergency powers argument that the courts had just rejected, making it harder for importers to mount the kind of successful challenge that unravelled the previous system. Whether that confidence survives contact with the courts remains to be seen, but the administration is clearly betting that a narrower, rules based justification will prove more resilient than a broad claim of emergency authority.
The financial backdrop to this shift is just as revealing as the legal manoeuvring. According to government figures, tariff revenue has indeed climbed under the current administration, reaching roughly 195 billion dollars in the last full fiscal year and around 163 billion dollars in the first nine months of the following one. Yet those numbers mask a much messier reality underneath. After the Supreme Court’s ruling, the government was forced to refund around 81 billion dollars in tariffs it had already collected, and in June alone it ended up refunding some 26 billion dollars more than it actually brought in. For an administration that has repeatedly presented tariffs as a dependable new source of national income, that scale of repayment is an awkward admission that the legal foundation beneath its trade strategy has been far shakier than advertised. It also helps explain the urgency behind this week’s move, since allowing tariffs to lapse entirely, even briefly, would have meant conceding financial and political ground that officials were clearly unwilling to give up.
What this means for allies, rivals and the rules based system
For countries on the receiving end, the practical effect is another jump in the cost of selling into the American market, layered on top of tariff regimes that have already been reshaped several times in little more than a year. Businesses and governments from Europe to Asia have grown used to sudden announcements, court rulings and legal workarounds arriving in rapid succession, and this latest change adds yet another layer of uncertainty to supply chains that were only just adjusting to the previous rules. Trade officials in several capitals are likely to study the new tariffs closely for grounds to challenge them, given how directly they follow a Supreme Court defeat, and given that forced labour enforcement records vary enormously between countries with very different labour systems and monitoring capacities. There is also a wider signal here for the international trading system as a whole. Each time Washington finds a new legal route to reimpose tariffs after a setback in court, it reinforces the impression among allies and rivals alike that American trade policy is now driven primarily by the search for durable legal cover rather than by negotiated agreements, a shift that weakens the predictability that global commerce depends on.
Over the coming months, the real test will not be whether these tariffs take effect, since they already have, but whether they survive the legal challenges that are almost certain to follow from importers and possibly from foreign governments as well. If courts accept the forced labour justification as sufficiently narrow and well grounded, it could become a template the administration reaches for again in future disputes, effectively replacing the broad emergency powers approach that the Supreme Court closed off. If the courts instead see through the reasoning as another attempt to achieve the same sweeping outcome through a different legal door, Washington may find itself right back where it started in February, scrambling for yet another statute to keep its tariff wall standing. Either way, the pattern emerging is unmistakable, a White House determined to keep tariffs as a central tool of American power, adapting the legal packaging as many times as it takes, while trading partners are left to manage the uncertainty in between.
