In a significant legal development, the US Court of Appeals for the District of Columbia Circuit has ruled that former President Donald Trump's "reciprocal tariffs" will remain in effect during the ongoing appeal process. This decision, announced on June 10th, allows the Trump administration to continue leveraging the tariffs in its trade negotiations with various countries, at least for the next few months.
The appellate court's ruling temporarily halts a previous lower court decision that had ordered the suspension of the tariffs, thereby extending their validity. The next hearing is scheduled for July 31, which means the tariffs will remain active for a minimum of two more months. This timing is crucial, as it coincides with the July 9 deadline set by Trump for halting the reciprocal tariffs.
The Trump administration has been actively engaged in trade talks with several nations and had argued that invalidating the tariffs could severely disrupt US foreign policy. They emphasized that maintaining the tariffs is more beneficial for ongoing trade negotiations than the potential economic harm to plaintiffs challenging the policy.
While the appellate court did not disclose its reasons for the ruling, it highlighted the "unusual importance" of the case, suggesting the possibility of an en banc hearing involving a full panel of judges. Such hearings are rare and indicate the case's significance.
Trump's reciprocal tariffs were introduced as a response to perceived unfair trade practices against the US, imposing a 10% basic tariff on all countries under the International Emergency Economic Powers Act (IEEPA). The tariffs have been a contentious issue, with the US Court of International Trade previously ruling that only Congress has the authority to impose such measures.
The ultimate decision on the legality of these tariffs may rest with the US Supreme Court, which currently has a conservative majority that has generally been supportive of Trump's policies. Meanwhile, tariffs on steel, aluminum, and automobiles, which were enacted under different legislation, remain unaffected by this court decision.
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