New Tariff Landscape After Supreme Court Ruling
President Trump imposed IEEPA tariffs on US trading partners including China, Canada, Mexico, and the EU in 2025. However, the Supreme Court recently ruled in a 6-3 decision in Learning Resources Inc. v. Trump and V.O.S. Selections v. United States that “IEEPA does not authorize the President to impose tariffs.”
Key Data: After the IEEPA tariffs were struck down, President Trump responded by signing an executive order that would impose a 10 percent tariff on all countries under Section 122 with exemptions, effective February 24, 2026. We estimate this new tariff would apply to $1.2 trillion worth (34 percent) of annual imports.
Significant Increase in US Household Tax Burden
According to Tax Foundation analysis, the Trump tariffs in 2025 amounted to an average tax increase per US household of $1,000. After the IEEPA tariffs were struck down, we estimate the President’s remaining new tariffs under Section 232 will increase taxes per US household by $400 in 2026. The Section 122 tariffs will increase this household burden by about $200 to $600 in 2026.
We estimate with the IEEPA tariffs being ruled illegal, the remaining Section 232 tariffs imposed in 2025 increase the weighted average applied tariff rate on all imports to 6.7 percent in 2026, down from 13.8 percent under the IEEPA tariffs. While the 10 percent Section 122 tariffs are in effect, we estimate this rises to 10.3 percent, and then falls to 6.7 percent after the Section 122 tariffs end.
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