Just a day after a trade court struck down Donald Trump’s sweeping tariff regime, a US appeals court has temporarily reinstated the duties, allowing them to stay in place while legal challenges continue. The ruling marks a dramatic turn in Trump’s use of emergency powers to impose tariffs on countries around the world, a move that has long stirred global economic tensions and legal scrutiny.
Appeals Court Pauses Injunction on ‘Liberation Day’ Tariffs
The US Court of Appeals for the Federal Circuit ruled on Thursday that the lower court’s injunction against the tariffs will remain on hold for now. This means Trump’s “Liberation Day” tariffs—originally imposed on April 2 under the International Emergency Economic Powers Act (IEEPA)—can still be collected by the government. The decision offers temporary relief to the Trump camp as they challenge the earlier judgment by the US Court of International Trade, which found the tariffs unlawful.
The tariffs targeted countries that had persistent trade surpluses with the US, with rates as high as 50%, while a general 10% duty was applied to others. Trump justified the move under IEEPA, a 1977 law allowing the president to act during national emergencies. However, the trade court ruled that Trump’s use of the law to impose broad economic measures over longstanding trade imbalances did not qualify as a genuine emergency.
Legal Setback Followed by Judicial Reprieve
The initial ruling against Trump came from two consolidated lawsuits—one from a coalition of 12 US states, and another filed by five small businesses—arguing that the President had overstepped his authority. Jeffrey Schwab, a lawyer representing the businesses, said the administration used IEEPA as a legal shortcut to bypass Congress. The court agreed, noting that the US has had trade deficits for nearly five decades, which does not constitute an unexpected crisis.
Adding to Trump’s legal woes, Judge Rudolph Contreras also blocked the tariffs as they applied to two Illinois-based toy companies. These rulings put pressure on Trump’s trade strategy, but the appeals court’s temporary stay offers him breathing room to press on with his legal arguments.
India was also affected by the tariffs and responded with a 26% duty on US goods. Talks between New Delhi and Washington are ongoing to finalize a broader Bilateral Trade Agreement aimed at resolving trade frictions.
