US Trade Court Rules Trump's 10% Global Tariffs Illegal

May 8, 2026

The US Court of International Trade ruled 2-1 on May 8, 2026 that President Donald Trump's 10 percent global tariffs imposed February 24, 2026 were unlawful. The court found Section 122 of the Trade Act of 1974 did not justify across-the-board tariffs for the trade deficits Trump cited, including a $1.2 trillion annual US goods trade deficit. Small businesses successfully challenged the tariffs.

Court ruling on tariffs

▪One judge in the US Court of International Trade ruling said it was premature to grant victory to the small business plaintiffs.
▪The US Court of International Trade ruled on May 8, 2026 against President Donald Trump's 10 percent global tariffs.
▪The US Court of International Trade ruling on the 10 percent global tariffs was 2-1.
▪The US Court of International Trade found that across-the-board tariffs were not justified under a 1970s trade law.

Small business legal challenge

▪Small businesses challenged President Donald Trump's 10 percent global tariffs that took effect on February 24, 2026.
▪Jay Foreman is CEO of toymaker Basic Fun!
▪Small businesses argued the 10 percent global tariffs were an attempt to sidestep a landmark US Supreme Court decision that struck down President Donald Trump's 2025 tariffs imposed under the International Emergency Economic Powers Act.

Trade Act legal justification

▪President Donald Trump invoked Section 122 of the Trade Act of 1974 in his February 2026 order imposing 10 percent global tariffs.
▪Section 122 of the Trade Act of 1974 allows for duties for up to 150 days to correct serious balance of payments deficits or head off an imminent depreciation of the dollar.
▪The US Court of International Trade found the Trade Act of 1974 was not an appropriate step for the kinds of trade deficits that President Donald Trump cited in his February 2026 order.

Economic deficit arguments

▪Some economists and trade lawyers argue the US is not on the cusp of a balance-of-payments crisis, making the 10 percent global tariffs vulnerable to a legal challenge.
▪The Trump administration argued that a serious balance-of-payments deficit existed in the form of a current account deficit of 4 percent of gross domestic product.
▪The Trump administration argued that a serious balance-of-payments deficit existed in the form of a $1.2 trillion annual US goods trade deficit.

Perspective of Trump administration

▪The Trump administration argued that a serious balance-of-payments deficit existed in the form of a current account deficit of 4 percent of gross domestic product.
▪The Trump administration argued that a serious balance-of-payments deficit existed in the form of a $1.2 trillion annual US goods trade deficit.