Watch CBS News
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
Tag Archives: Tariffs
Trump announces 50% steel tariffs as Nippon deal sparks hope for U.S. jobs
Watch CBS News
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
As Trump’s tariffs face legal challenge, here are some of his other trade policy options
The Trump administration could pursue alternative pathways for imposing tariffs after a federal court this week struck down its use of emergency powers to enact broad levies on U.S. trading partners, according to experts.
At risk is much of Mr. Trump’s trade agenda, which relies on tariffs as a way to secure better terms of trade, boost the U.S. manufacturing sector and generate what he claims could be trillions in new federal revenue. For now, Mr. Trump’s tariffs remain in place after a federal appeals court in Washington, D.C., on Thursday temporarily halted the decision, reinstating the levies.
If the trade court’s ruling is ultimately upheld, Mr. Trump has other tools for pursuing his trade agenda, although they don’t provide the broader authority of the International Emergency Economic Powers Act (IEEPA), which he tapped to authorize trade duties on almost every foreign nation.
“He would have a couple other authorities. However, they are not nearly as broad and aggressive as the IEEPA tariffs,” said Clark Packard, a research fellow in the Herbert A. Stiefel Center for Trade Policy Studies at the Cato Institute, a nonpartisan public policy institute. “There are so many checks and administrative aspects to them that they are slower.”
Mr. Trump announced his tariffs on April 2 in an initiative he referred to as “Liberation Day.” At the time, the president described trade deficits with other nations as “a national emergency,” which he said gave him the authority to impose tariffs under IEEPA.
But a lawsuit filed by five U.S.-based companies and a group of 12 states challenged the president’s use of the emergency powers law, and on Wednesday the Court of International Trade blocked the tariffs.
President will use “tools at his disposal”
As the legal process plays out, Trump administration officials say the president is considering using other tools at his disposal to advance his trade policies.
“The Trump administration remains committed to addressing our country’s national emergencies of drug trafficking and historic trade deficits with every legal authority conferred to the President in the Constitution and by Congress,” White House spokesperson Kush Desai said in a statement to CBS News on Thursday.
Desai added, “Regardless of the developments of this litigation, the President will continue to use all tools at his disposal to advance trade policy that works for all Americans.”
Here are the other options Mr. Trump could turn to, and how he could use them, according to policy experts.
Section 232 tariffs of the Trade Expansion Act of 1962
Experts say Mr. Trump could turn to Section 232 of the Trade Expansion Act of 1962, which allows the U.S. president to restrict imports in the name of national security. Mr. Trump already has tariffs in place on steel, aluminum and auto imports based on this regulation.
There’s a catch, though. The statute requires the Department of Commerce, in consultation with the Department of Defense, to investigate and confirm that imports “threaten to impair” U.S. national security before the president can invoke Section 232. An investigation can take up to 270 days, which could slow down Mr. Trump’s timeline for imposing tariffs.
“It has to withstand legal scrutiny, it can’t just be done over the weekend,” Packard said.
Additionally, under Section 232, tariffs can only be applied to specific sectors if the trade around those imports threaten national security, rather than the broad approach that Mr. Trump used with IEEPA.
“Once the report is issued, the president has wide discretion, but he has to target individual sectors of product, like steel and aluminum,” Packard said. “They can’t be blanket, across-the-board tariffs.”
Some experts think Mr. Trump is likely to turn to this statute to further his tariff agenda.
“In our view, the administration will prepare the groundwork for a more surgical increase in tariffs beginning this summer following Section 232 trade investigations into strategic industries like pharmaceuticals, critical minerals, lumber, copper and semiconductors,” Kurt Reiman, head of fixed income Americas at UBS Global Wealth Management, said in a research note.
He added, “These sectors were initially excluded from the 10% baseline tariff because President Trump had intended to levy separate tariffs to reduce the U.S.’s reliance on foreign producers of these products by encouraging domestic production.”
Section 301 of the Trade Act of 1974
Mr. Trump could also draw on the Trade Act of 1974 to impose new tariffs. Section 301 of that law allows the U.S. president to apply county-based tariffs at a rate of his choosing if the U.S. Trade Representative determines that another country is engaging in unfair foreign trade practices.
There are limitations, however. The law can’t be applied universally to all imports from foreign nations.
“There has to be justification for it, so President Trump can’t unilaterally decide to impose broad-based tariffs on the entire world,” Angela Santos, a partner and customs practice leader at law firm ArentFox Schiff told CBS MoneyWatch.
Section 122 of the Trade Act of 1974
Additionally, Mr. Trump could use Section 122 of the Trade Act of 1974, which is designed to address large trade deficits with other nations, to impose tariffs of up to 15% for a maximum of 150 days.
“I could see this being employed very easily,” Santos said. “It seems like the easiest way to impose tariffs, particularly because most trade partners have large deficits with the U.S.”
Applying tariffs under Section 122 wouldn’t require an investigation, meaning Mr. Trump could quickly use it to assess a broad-based import duty.
“The administration could quickly replace the 10% across-the-board tariff with a similar tariff of up to 15% under Sec. 122,” Goldman Sachs analysts wrote in a report this week.
The tariffs could be in effect “within days if deemed necessary,” Goldman Sachs said.
Congressional action would be needed to extend the tariffs after 150 days.
Section 338 of the Tariff Act of 1930
Under Section 338 of the Tariff Act of 1930, the president can impose tariffs of up to 50% on imports from countries that discriminate against the U.S. The law defines discrimination as when a trading partner’s laws, import duties, regulations or other restrictions place the U.S. at a disadvantage.
These tariffs differ from Section 301 levies in that the tariff rate is capped at 50%. Additionally, no formal investigation is required. The authority has never been used, according to experts.
Breaking down federal court rulings on Trump tariffs
Watch CBS News
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
What is the Court of International Trade? Learn more about the judges who blocked Trump’s tariffs.
Federal judges in the U.S. have challenged the Trump administration on everything from deportations of immigrants to mass layoffs of government workers. Now, the U.S. Court of International Trade is stepping in to challenge President Trump’s sweeping tariffs.
The New York-based court late Wednesday struck down most of the tariffs implemented under Mr. Trump, dealing a serious blow to one of his signature economic policies. Mr. Trump has said tariffs are necessary to erase the trade deficit, make the U.S. more competitive and energize the U.S. manufacturing sector.
The ruling, which the Trump administration has already appealed, voids both a 10% baseline tariff on most countries introduced on April 2 in what the president referred to as “Liberation Day,” and also blocks a separate set of levies imposed on China, Mexico and Canada. It does not impact U.S. tariffs assessed on specific sectors, including steel, aluminum and autos.
Read on to learn more about the Court of International Trade and how it operates.
What is the Court of International Trade?
Located in downtown Manhattan, the U.S. Court of International Trade, or CIT, is a federal court that focuses on international trade issues. It resolves disputes between governments, manufacturers, trade associations and other parties that may be privy to trade dealings.
According to the CIT’s website, the court serves as the main judicial forum for resolving civil actions related to import transactions and federal issues affecting global trade. In that role, the CIT helps avoid jurisdictional conflicts on trade matters that might arise among other federal courts.
The Court of International Trade was created as part of the the Customs Court Act of 1980, which reorganized the U.S. Customs Court into the CIT. The new court was established under Article III of the Constitution and has jurisdiction over any trade-related issues arising in the U.S. It is also authorized to hold hearings in foreign countries, according the court’s website.
The courthouse is located at One Federal Plaza in New York City.
How many judges sit on the court?
Nine judges sit on the Court of International Trade, all of whom are appointed for life. Those judges are chosen by the U.S. president, but the Senate must consent to those selections. According to the rules of the court, no more than five judges can be from the same political party.
Currently, the court’s chief judge is Mark Barnett. He appointed by President Barack Obama in 2013 and began his post as chief judge in 2021, according to his bio page on the court’s website.
Which judges stuck down the Trump tariffs?
Three CIT judges rules that President Trump exceeded his legal authority in imposing the tariffs: Judge Timothy Reif, who was nominated by Mr. Trump; Judge Jane Restani, who was nominated by former President Ronald Reagan; and Judge Gary Katzmann, who was nominated by former President Obama.
How do rulings work?
Typically, the CIT’s chief judge assigns cases to a specific judge. In certain instances, including when the case involves a presidential executive order or if it has broad legal implications for customs laws, the chief judge can assign it to a three-judge panel. Cases are then decided by a majority of judges.
In Wednesday’s decision, the judges unanimously ruled to block the Trump administration tariffs introduced under the International Emergency Economic Powers Act of 1977.
Although the CIT is in New York, the court’s judges have nationwide jurisdiction and preside over cases across the U.S. If a case is appealed, as it was in this instance, it then moves the U.S. Court of Appeals for the Federal Circuit in Washington, D.C. and, potentially, to the Supreme Court.
What types of cases does the court rule on?
The Court of International Trade resolves trade disputes by interpreting U.S. customs and international trade laws, such as the Tariff Act of 1930. One example would be enforcing anti-dumping or countervailing duties, which protect domestic manufacturers by preventing foreign companies from selling goods at prices below market value.
The court rules on dozens of cases each year. So far this year, it has issued 66 opinions.
Here’s what to know about Trump’s tariffs after a U.S. trade court rules them illegal
President Trump’s sweeping tariffs on goods imported from almost every foreign nation have been ruled illegal by the U.S. Court of International Trade, marking a setback for the president’s trade agenda — and adding another level of uncertainty for U.S. consumers and businesses.
The Wednesday ruling from the court halted the tariffs Mr. Trump assessed on virtually every other country on April 2, a day he termed “Liberation Day.” Some trading partners faced substantially higher import duties, with the president hiking tariffs on China-produced goods to as high as 145% before easing them temporarily earlier this month.
The ruling raises a host of questions about what happens next, given that Mr. Trump’s trade agenda hinges on wide-ranging tariffs that he has promised will help bring back U.S. manufacturing jobs while also raising trillions in new revenue for federal coffers. Meanwhile, the court decision will likely provide a measure of relief to American businesses and consumers, given that they’re typically on the hook for paying the tariffs when imports reach U.S. soil.
But the ruling also introduces new layer of uncertainty. For one, the Trump administration said it intends to appeal the ruling to the Federal Circuit Court of Appeals. Secondly, Mr. Trump could seek alternate routes to deploy additional tariffs, experts say.
“At the moment, it is anyone’s guess as to whether these very unpopular tariffs will be reinstated on appeal or by the Supreme Court,” said Carl Weinberg, chief economist at High Frequency Economics, in a May 29 research note. “So, uncertainty is now poised to escalate.”
Here’s what to know about Mr. Trump’s tariffs following the ruling.
Are any of Mr. Trump’s tariffs still in effect?
Yes, the U.S. Court of International Trade’s ruling applies to the Trump administration’s tariffs that were issued under the International Emergency Economic Powers Act, or IEEPA. But the Trump administration has also levied additional import duties by tapping other trade rules, and those remain in effect.
“The tariffs that remain in place are the Section 232 tariffs of 25% on automotive, steel and aluminum imports and the Section 301 tariffs on China that were imposed during President Trump’s first term and expanded under the Biden administration,” analysts at research company Capital Economics noted in a May 29 note.
The president cited the IEEPA to announce the so-called reciprocal tariffs on April 2. At the time of the announcement, Mr. Trump said that trade deficits with other nations represented “a national emergency.”
But the court on Wednesday ruled that Mr. Trump’s global tariffs aren’t authorized by the IEEPA, and said it would be unconstitutional for any law passed by Congress to give the president blanket authority to set tariffs.
“The court does not read IEEPA to confer such unbounded authority and sets aside the challenged tariffs imposed thereunder,” the judges wrote Wednesday.
Could Mr. Trump reinstate the tariffs?
Mr. Trump could reinstate the tariffs if he wins on appeal, but his administration could also seek other routes to reimpose the import duties, according to Goldman Sachs economists.
For instance, the president could use Section 122 of the Trade Act of 1974 to impose tariffs of up to 15%, but they would be limited to 150 days, according to Goldman Sachs. A section of the Trade Act of 1930 would allow the president to impose tariffs of up to 50% on imports from nations that discriminate against the U.S., they added.
“Section 232 tariffs, which President Trump has already used for steel, aluminum and autos, could be broadened to cover other sectors,” they noted.
What does this mean for U.S. businesses and consumers?
Until the appeal is resolved, there will be some added level of uncertainty for U.S. businesses, which are on the hook for paying the tariffs when imported goods reach U.S. ports, some economists said on Thursday.
Most or all of the tariffs are passed on to consumers in the form of higher prices, economists say, which has prompted them to forecast higher inflation in 2025. But given that some of Mr. Trump’s other tariffs remain in place, U.S. businesses are still on the hook for those additional import duties. That means that while the effective tariff rate is now lower, it’s still significantly higher than it was prior to the current Trump administration.
“We calculate that the effective tariff rate is now 6.5%, up from 2.5% at the start of the year but far lower than the 15% rate based on our assumption of the IEEPA-related tariffs remaining in place,” noted Capital Economics.
Even so, U.S. investors cheered the ruling, signaling relief from Wall Street that the overhang from the tariffs has been removed, albeit perhaps temporarily. The tariffs had raised the risks of a recession and were expected to boost inflation this year, economists had forecast.
Stock market futures jump after court halts most Trump’s tariffs
Stock futures are jumping after a federal court late Wednesday froze most of the tariffs the Trump administration has imposed on U.S. trading partners.
The U.S. Court of International Trade ruled President Trump had overstepped his legal authority in assessing a 10% levy in an April 2 barrage of tariffs he referred to as “Liberation Day.” The court also blocked a separate set of U.S. duties on China, Mexico and Canada.
Futures on the S&P 500 were up 67 points, or 1.1%, to 5,969 as of 7:27 a.m. EST, while contracts on the Dow Jones Industrial Average and Nasdaq Composite rose 0.5% and 1.6%, respectively.
“Just when traders thought they’d seen every twist in the tariff saga, the gavel dropped like a lightning bolt over the Pacific,” Stephen Innes of SPI Asset Management said in a report.
Overseas markets also rose following the surprise legal decision. In early European trading, Germany’s DAX gained 0.5% and France’s CAC 40 added 0.9%. In Asia, Japan’s Nikkei 225 index surged 1.9%. America’s largest ally in Asia had urged Mr. Trump to cancel the tariffs on imports from Japan and to also halt 25% tariffs on steel, aluminum and autos.
The ruling by the three-judgel panel means the baseline 10% tariff; so-called reciprocal tariffs on dozens of other nations that the U.S. had paused for 90 days; a 20% levy on China related to fentanyl; and a 25% tax on certain imports from Canada and Mexico are void. The court gave the Trump administration 10 days to issue new orders canceling the tariffs.
The Trump administration had cited the International Emergency Economic Powers Act of 1977, or IEEPA, which gives the president the power to regulate imports during certain emergencies. But the court rejected the government’s interpretation of the law. The Trump administration said it will appeal the ruling to the Federal Circuit Court of Appeals.
“If the Trump administration loses its appeal, then it will reduce the downside risks to the economy and the upside risks to inflation if no other tariffs are imposed,” analysts with Capital Economics told investors in a client note.
contributed to this report.
Court strikes down Trump’s tariffs, ruling them illegal
A federal court on Wednesday froze many of the large-scale tariffs imposed by President Trump on virtually every foreign nation, ruling the levies exceed the president’s legal authority.
The ruling — issued by a panel of judges on the U.S. Court of International Trade — focused on the sweeping 10% tariffs the president assessed on virtually every U.S. trading partner last month, with higher tariffs threatened for dozens of countries.
The court said the economic emergency powers law cited by Mr. Trump during his April rollout of the global tariffs — dubbed “Liberation Day” — didn’t give him the power to impose tariffs. The judges also said it would be unconstitutional for a law to give the president blanket authority to set tariffs.
CBS News has reached out to the White House for comment.
This is a developing story and will be updated.
Trump pauses tariffs on European Union goods after negotiations
Watch CBS News
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.
What a slowdown in international travel could mean for America’s tourist hubs
Sault Ste. Marie in Michigan is a small city with a thriving economy. That’s because visitors from its larger northern sister city in Ontario, Canada, keep the border town’s economy humming.
Situated on opposite sides of the St. Marys River, the U.S. and Canadian counterparts are connected by the Sault Ste. Marie International Bridge, over which thousands of vehicles pass each month.
“It’s so intertwined,” said Linda Hoath, executive director of the Sault Area Convention & Visitors Bureau, who noted that many people have family members on both sides of the U.S.-Canada border. “There’s no separation between the two communities,” she said.
But with the U.S. trade war unleashed against Canada in recent months — along with reports of detentions of travelers at the Canadian border by U.S. immigration authorities and threats of annexation by President Trump, the chasm between the two neighbors has grown, as fewer Canadians make the trip south to the United States.
According to Sault Ste. Marie’s International Bridge Administration, the passenger car traffic in April was down 44% compared with last year. And while the waning bridge traffic may not mean much from the view of Canada’s second-largest province and most popular destination, to the historic Michigan town it certainly does.
“They have 70,000 people,” Hoath said. “And if they’re not coming over and buying in our stores, then it affects us much more.”
Slowdown in travel to the U.S.
Sault Ste. Marie is not alone in its tourism concerns. Though travel this Memorial Day weekend is expected to be the highest on record, one group has been noticeably absent at U.S. travel checkpoints in recent months: international travelers.
International travel to the U.S. fell 14% in March compared with the same period last year, according to the the U.S. Travel Association. Perhaps unsurprisingly, the biggest dip in travel, 20.2%, was from Canada, according to research from Tourism Economics, a unit of investment advisory firm Oxford Economics.
Earlier this year, former Prime Minister Trudeau urged Canadians to refrain from vacationing in the U.S., after President Trump slapped a 25% tariff on Canadian goods. The drop-off in Canadian travel is a notable shift, given that Canada was the biggest source of inbound travel to the U.S. last year, according to the World Travel & Tourism Council.
As to what’s behind the overall slowdown in international travel to the U.S., experts point to the Trump administration’s stricter immigration policies, the strength of the U.S. dollar and long visa wait times. Aggressive tariff policies have also left a bad taste in many travelers’ mouths.
“Shifting sentiment and perceptions of the U.S. are expected to continue to weigh heavily on travel demand,” said Aran Ryan, director of industry studies at Tourism Economics.
As of April, flight bookings to the U.S. for the May–July travel window are 10.8% lower than they were the same period last year, according to the research firm. It projects an 8.7% decline in international arrivals in 2025.
Economic Impact
The slowdown in international travel threatens to destabilize America’s tourism industry which plays a vital role in supporting the nation’s economy.
“International inbound travel is hugely important from an economic standpoint — people that come to the U.S. and visit spend on average $4,000 per visit,” a spokesperson from the U.S. Travel Association, told CBS MoneyWatch.
Those dollars may already be slipping away: The World Travel & Tourism Council projects that spending by international visitors to the U.S. will drop to $169 billion, or 7%, this year, from $181 billion in 2024. That’s a 22.5% decrease from peak tourist spending of $217 billion in 2019, before the pandemic.
Fewer international travelers could also take a toll on the workforce that props up America’s tourism industry: Nearly 10% of American jobs are tied to the travel industry, according to the World Travel & Tourism Council.
An ongoing decline in international travel to the U.S. could result in a loss of over 230,000 jobs — with the dining and lodging industries expected to be the most hard hit, according to a recent analysis from the economic research firm IMPLAN.
“It’s not going to devastate the U.S. economy in terms of GDP, but it is very significant in terms of employment,” Jenny Thorvaldson, IMPLAN’s chief economist and data officer, told CBS MoneyWatch.
Hoath, who runs the visitor center in Sault Ste. Marie, said she is already worried about what those losses could mean for her community.
“When we’re looking at the bridge and it’s packed, people have to get their employees together,” she said. “But if it’s not so busy, what happens to your employees? They’re not making the money. Some people will be laid off.”
Hotel bookings in the city of 14,000 are already down 77% year to date, according to the Sault Area Convention & Visitors Bureau.
Shifting focus to domestic travelers
As international tourism dampens, local communities like Flagstaff, Arizona, are rerouting their attention to domestic travelers.
Despite the city’s wide international appeal, the travel season has gotten off to a slow start. Flagstaff has seen a 15% to 20% drop in international tourists year over year, according to Trace Ward, director of Flagstaff’s Convention and Visitors Bureau.
While he hopes that decline will only be temporary, Ward is looking for ways to bring in more American tourists. One strategy he has in mind is adding more direct flights to the area and possibly attracting a new airline. The city is also promoting its Lowell Observatory‘s new Astronomy Discovery Center, which offers visitors a glimpse of the cosmos.
“I look forward to the excitement of the international traveler coming back full steam, but until then, we’re gonna sell to whoever is interested in coming here,” Ward said.
Hoath, likewise, has shifted her focus toward attracting visitors from within the States, and has decided to halt spending on any advertising in Canada.
“When you don’t have a ton of funds, you’ve got to put them where you know they have a better possibility of working,” she said.