A U.S. trade court has struck down most of Donald Trump’s global tariffs, ruling they were imposed illegally under emergency powers. The unanimous decision by a three-judge panel in Manhattan halts Trump’s flat-rate levies and additional tariffs on China, Canada, and Mexico — unless an appeals court intervenes.

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The court sided with Democratic-led states and small businesses, who argued Trump abused the International Emergency Economic Powers Act (IEEPA) to justify sweeping trade measures. The law is typically used for financial sanctions during genuine crises, not to strong-arm trade partners.

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The judges ruled Trump’s actions went beyond his authority, noting his own lawyers admitted the tariffs aimed to “pressure” countries into better deals — not address an actual emergency. The ruling doesn’t affect tariffs imposed under different laws, like Section 232 or Section 301 (e.g. those on steel and aluminium).

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The U.S. Justice Department has already filed an appeal. But for now, the tariffs are blocked.

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Markets reacted quickly to the ruling, with Nasdaq futures jumping more than 2%, while the dollar gained strength and the yen weakened.

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The case could still reach the Supreme Court, but the decision marks a major blow to one of Trump’s core economic strategies — and a win for critics who said the tariffs were a backdoor tax on U.S. consumers.

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The ruling also hits back at Trump’s claims that long-standing trade deficits or drug trafficking justified the sweeping measures. Judges dismissed those rationales as legally flimsy and economically broad.

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Bottom line: Trump’s emergency tariffs are down — and unless higher courts reverse the decision, they may not be coming back.

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