Supreme Court Rules Against Tariffs

(Updated 2:15 pm MT, February 20, 2026)

The Supreme Court ruled Friday that the administration exceeded its authority under the International Emergency Economic Powers (IEEP) Act of 1977 by imposing broad tariffs on imports from a wide range of countries.

The court ruled that the president must have clear congressional authorization to impose tariffs, and that the IEEP, which doesn't mention tariffs, does not provide that authorization. Notably for brewers, this ruling only covers tariffs imposed using the IEEP as their basis for authority and does not include tariffs imposed under other statutes, such as the "section 232" tariffs imposed on steel and aluminum.

What Happens Next: New Authorities Under Consideration

While the 6-3 ruling curtails one pathway for broad tariffs, the administration has already signaled it intends to pursue alternative statutory authorities to reinstate many of the measures.

Among the options reportedly under consideration:

Section 122 of the Trade Act of 1974. This provision allows the president to impose tariffs of up to 10% for 150 days to address balance-of-payments concerns. After that period, congressional action would be required to extend the tariffs. While more limited in scope and duration than the IEEP tariffs, Section 122 could be used to quickly reimpose broad-based duties while setting up a potential legislative battle.

Section 301 of the Trade Act of 1974. The administration could also initiate or expand Section 301 investigations into alleged unfair trade practices. Section 301 tariffs are more targeted and must be tied to findings following an investigation by the U.S. Trade Representative. However, prior 301 actions have affected wide categories of goods and extended for years, so the practical reach of this authority can be significant.

While both of these moves would fall within executive authority, the administration is broadly signaling it retains the authority to implement the President's tariff policies, potentially setting up another legal confrontation that could again test the courts' willingness to constrain tariff powers absent explicit congressional direction.

In short, while the Supreme Court's decision limits the use of emergency powers, it does not mark the end of tariff uncertainty.

Impact on Ongoing Trade Negotiations

The threat of IEEP-based tariffs was central to several recent trade negotiations. With that authority curtailed, trading partners may reassess previously negotiated agreements or harden positions in ongoing talks.

If the administration moves forward with Section 122 or 301 authorities, the dynamic could shift again, potentially prolonging uncertainty for importers and manufacturers, including brewers that rely on global supply chains.

What This Means for Tariffs Already Paid

It remains unclear how the ruling affects tariffs already collected under the IEEP framework. Some importers have begun preparing claims for potential refunds, but the legal and administrative process is uncertain and could take considerable time to resolve.

Brewers who believe they may be affected should stay in close communication with their importers, customs brokers, and legal counsel as further guidance emerges.

Congress's Role Going Forward

The Court's ruling underscores that Congress holds constitutional authority over tariffs. Whether Congress chooses to assert that authority more actively remains an open question.

Section 122, in particular, would force Congress to decide within 150 days whether to extend any new broad-based tariffs. That could create a meaningful policy debate about the role of tariffs in U.S. trade policy and their impact on domestic manufacturers.

The Brewers Association Hill Climb is next week, and members will discuss the impact of tariffs - including those imposed under Sections 232, 301, and any new authorities - with hundreds of Congressional offices. Communicating the real-world impact of tariff instability on small and independent brewers remains critical.

Next Steps

Your Brewers Association government affairs team continues to work to lower your cost of doing business, including tariffs, as a top priority, and we'll be keeping members updated accordingly as we learn more.