The Supreme Court is poised to make a significant decision regarding President Donald Trump’s tariff agenda, with potential implications for American consumers’ finances. As early as Friday, the court may rule on whether certain tariffs imposed under the International Emergency Economic Powers Act (IEEPA) of 1977 are unconstitutional. Economists suggest that a ruling against these tariffs could provide financial relief to consumers who have faced rising prices due to these import taxes.
The tariffs imposed by the Trump administration through IEEPA were unprecedented, resulting in the highest import tax rates since the early 20th century. According to John Ricco, an associate director at the Yale University Budget Lab, the effective tariff rate currently stands at 16.9%, the highest recorded since 1932. A recent paper from the Federal Reserve Bank of New York indicated that U.S. firms and consumers bore approximately 90% of the costs associated with the tariffs implemented in 2025. In contrast, White House officials have challenged these findings.
Businesses tend to pass some of their increased costs to consumers, which means that items ranging from electronics to food have become more expensive due to tariffs. The Tax Foundation estimated that Trump’s tariffs would cost U.S. households about $1,000 in 2025, with projections increasing to $1,300 in 2026. Similarly, the Yale Budget Lab has estimated that consumers will face additional costs of $1,300 to $1,700 in 2026. However, if the Supreme Court were to deem the IEEPA tariffs unconstitutional, the burden on consumers could decrease by about half, dropping costs to an estimated $600 to $800 in 2026.
Should these tariffs be invalidated, the overall effective tariff rate could fall to around 9%, still significantly higher than the approximate 2% average rate prior to Trump’s second term. Even with this potential relief, consumer costs would not completely diminish due to existing tariffs established under different legal frameworks.
The Trump administration has utilized IEEPA to impose tariffs on a wide range of trading partners, generating about $133.5 billion in tariff revenue in fiscal year 2025 alone. Among the key actions taken were a 10% baseline tariff on all trading partners and additional tariffs on specific nations. Furthermore, IEEPA has been leveraged to enact tariffs on countries like Canada, China, and Mexico, based on various justifications, including allegations related to drug trafficking and geopolitical issues.
However, experts like Gary Hufbauer from the Peterson Institute for International Economics have noted that should the Supreme Court rule against IEEPA tariffs, the Trump administration likely has other legislative avenues available to maintain similar tariff levels, albeit possibly at a slower pace. For instance, Section 232 of the Trade Expansion Act of 1962 could serve as a tool for reimplementing tariffs on products such as steel and automobiles.
As the nation awaits the Supreme Court’s decision, many Americans remain hopeful that a ruling against these tariffs may bring some much-needed financial respite from rising consumer prices, further underscoring the complex interplay between trade policy and everyday life.