Trump is reframing the Supreme Court tariff loss as a detour, not a derailment, as his team shifts the broad tariff base to Section 122 while keeping key sector and China-related tariffs intact.
Summary:
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Trump addressed tariffs during his SOTU address
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Supreme Court ruled IEEPA doesn’t authorise tariffs (Feb 20, 2026)
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White House pivoted to temporary global tariffs under Section 122
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Rate set at 10% for 150 days; administration working toward 15%
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Many other tariffs (Section 232/301) remain intact
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Economists question “balance-of-payments crisis” rationale, raising fresh legal risk
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Refunds and trade-deal durability remain live issues
Trump says tariffs stay despite Supreme Court setback — what changed, what didn’t
In his State of the Union address, President Donald Trump called the Supreme Court’s decision against his tariff program “very unfortunate,” but argued tariffs will remain in place, most countries want to keep existing trade deals, and Congress won’t need to act.
The backdrop is a major legal loss for the White House on February 20, 2026, when the US Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) does not authorise the president to impose tariffs. The ruling invalidated a broad swathe of the administration’s emergency-tariff framework and immediately raised questions about refunds, deal continuity and the legal durability of the wider tariff agenda.
Crucially, the administration moved quickly to keep a tariff “floor” in place. Within hours of the ruling, Trump issued a new order imposing a temporary global tariff under Section 122 of the Trade Act of 1974 — initially set at 10% for 150 days, with the White House subsequently working to lift the rate to 15% (the statutory ceiling). Section 122 is rarely used and is framed around “serious” balance-of-payments concerns; economists and legal specialists have questioned whether current US conditions meet that test, raising the risk of further litigation.
Trump’s claim that tariffs “remain in place” is also helped by the fact that many other tariffs are unaffected by the IEEPA ruling, including Section 232 sector/national-security tariffs and Section 301 trade-action tariffs. In parallel, the administration has indicated it can pursue additional tariff probes under other statutory authorities, supporting the view that the tariff regime is being re-routed rather than dismantled.
On trade deals, US officials have signalled that counterparties have not moved to walk away, but governments are watching closely for how the legal reset affects enforcement and timelines. The next market focus is whether Section 122 tariffs are maintained beyond the 150-day window (where congressional involvement can become relevant), and whether refund claims grow as court challenges evolve.
