The Five Legal Pathways Trump Can Use to Rebuild His Tariff Regime | Explained

US President Donald Trump’s tariff policies faced a severe blow after the US Supreme Court struck down his ‘Liberation Day’ tariffs. However, the Trump administration is not defeated by that verdict. Following the court ruling, Trump initially set the global tariff rate at 10% before resetting and raising it to 15% within 24 hours.

The apex court’s ruling against the use of tariffs under the International Emergency Economic Powers Act (IEEPA) is now pushing the President’s team to probe alternative routes to continue the tariff framework under Trump 2.0. While no other legal remedy gives the same power to the President as the IEEPA, Trump still has other, rather old, trade laws under which he can impose duties.

What Was the SC Ruling?

The US Supreme Court ruling on Trump’s Liberation Day tariffs is considered the most significant loss of his second term. The Court ruled on Friday that the President violated federal law as he unilaterally imposed reciprocal tariffs across the globe. Chief Justice John Roberts wrote the majority opinion, and the Court agreed in a 6–3 ruling that the tariffs exceeded the law. The emergency authority Trump associated the tariffs with “fell short,” the Court said.

What Is the IEEPA?

Chapter 35 of the International Emergency Economic Powers Act refers to an “unusual and extraordinary threat; declaration of national emergency; exercise of Presidential authorities.” It grants the President the power to declare a national emergency regarding an “unusual and extraordinary threat” that has its source, in whole or substantial part, outside the United States. The Supreme Court ruled that while the Act allows sanctions and asset freezes, it does not permit the President to impose general tariffs.

Under the IEEPA, the President shall “consult” with Congress in every possible instance before exercising any of the authorities granted and shall consult regularly so long as such authorities are exercised. Trump, however, claimed nearly boundless authority to impose tariffs under the IEEPA, 1977, and did not consult Congress regarding these tariffs.

But that is just the IEEPA. Trump can use several other legal remedies to legitimise his tariff policies.

1. Section 122, Trade Act, 1974

Section 122 of the Trade Act, 1974 has now been resorted to after the Supreme Court ruling for swift global tariff action. This framework allows the President Balance-of-Payments (BOP) authority, under which he can impose a “temporary import surcharge” with a ceiling of 15%. This is valid only for 150 days without congressional approval. With Congress’ approval, the President can extend these surcharges. This legal framework is used when the US faces a “large and serious” BOP deficit.

Even though the tariff rate under this framework is lower than the reciprocal tariff deals agreed by Washington’s trading partners, it takes away preferential advantages, essentially making trade deals under negotiation irrelevant for the time being. The European Union has frozen the ratification of its deal with the US until further clarity on Trump’s tariff policies. India’s interim trade deal has also been put on hold.

2. Section 232, Trade Expansion Act, 1962

Section 232 of the Trade Expansion Act of 1962 allows the President to impose tariffs if imports are found to threaten national security. While the Commerce Department conducts the probe, it is the President alone who decides the remedies. Section 232 does not have a fixed tariff ceiling and does not expire, unlike Section 122.

During Trump’s first term, he invoked Section 232 in 2018 and imposed 25% tariffs on steel and 10% on aluminium. In June 2025, tariffs on steel and aluminium were raised to 50%.

Tariffs under Section 232 remain valid as they are based on national security concerns, not emergency economic rules. Therefore, the US government can still impose certain tariffs if it argues they are necessary to protect national security. This makes Section 232 a more limited, but still strong and viable, framework.

3. Section 301, Trade Act, 1974

Section 301 of the Trade Act, 1974 addresses unfair trade practices and allows the US Trade Representative (USTR) to probe and retaliate against foreign policies that are “unreasonable, unjustifiable, or discriminatory.” Trump previously used Section 301 to counter China; it was the legal framework behind tariffs on Chinese goods worth $370 billion. However, the framework has drawbacks when it comes to dealing with smaller countries.

With respect to India, New Delhi faced a Section 301 investigation in 2019 over price controls on medical devices and market access barriers. Invoking a Section 301 investigation on digital services, pharmaceutical pricing, or tariffs on information technology products would affect India’s service-led export sector.

4. Section 201, Trade Act

Section 201 of the Trade Act permits safeguard tariffs or quotas when a surge in imports causes, or threatens to cause, serious injury to a domestic industry. Safeguard tariffs are temporary, usually lasting three to four years. Unlike Sections 232 or 301, the safeguard framework does not require a probe into unfair trade; it simply requires a rise in import volumesInd

5. Section 338, Tariff Act, 1930

Section 338 of the Tariff Act of 1930 allows the President to increase tariffs or impose restrictions against countries that apply “unreasonable or discriminatory” duties or trade barriers against US goods. It permits the President to increase duties by up to 50%. However, it is rarely used in modern-day global trade policy.

The agricultural and dairy sectors were a hard red line during the months-long India–US trade negotiations. Union Commerce Minister Piyush Goyal has repeatedly reiterated that India will not open up its sensitive agriculture sector under any deal. If US exporters claim discriminatory treatment, the President could threaten to impose tariffs under Section 338.

Even as the White House searches for alternative legal pathways, US trade policy now finds itself in limbo. Major trade deals with countries such as India are effectively in a “wait-and-see” mode amid uncertainty surrounding Washington’s tariff strategy.

The bigger challenge for the Trump administration is that some of these backup statutes offer only short-term relief, while others are so aggressive that they risk triggering a full-blown trade war.