Murky outlook for businesses after tariff ruling prompts countermoves by Trump

NEW YORK– Businesses are facing a new wave of uncertainty after the Supreme Court struck down tariffs imposed by President Donald Trump under an emergency powers law and Trump vowed to circumvent the ruling to keep his tariffs in place.

The Trump administration says its tariffs are helping to boost U.S. manufacturers and reduce the trade deficit. But many U.S. companies have had to raise prices and adapt in other ways to offset the rising costs caused by the tariffs.

It remains to be seen to what extent businesses and consumers will actually benefit from Friday’s decision. Hours after the court’s ruling, Trump pledged to use a different law to impose a 10% tariff on all imports for 150 days, and to explore other ways to impose additional tariffs on countries he says are engaging in unfair trade practices.

“Any boost to the economy from lower tariffs in the short term is likely to be partly offset by a prolonged period of uncertainty,” said Michael Pearce, an economist at Oxford Economics. “While the administration is likely to rebuild rates through other, more sustainable means, the overall rate of rates could eventually stabilize near current levels. »

Efforts to recoup the $133 billion to $175 billion in tariffs previously collected and now considered illegal are bound to be complicated and likely to favor larger companies with more resources. Consumers hoping for a refund are unlikely to be compensated.

With Trump’s unyielding stance on tariffs, many companies are bracing for years of legal battles.

Basic Fun, a Florida-based maker of toys such as Lincoln Logs and Tonka trucks, last week joined a slew of other companies in a lawsuit seeking to recoup rates paid to the government.

Although the company’s CEO, Jay Foreman, is concerned about new tariffs that Trump may impose, he doesn’t think they will affect toys. He nevertheless said: “I worry about a sort of perpetual struggle over this, at least for the next three years. »

The new 10% tariff announced by Trump on Friday immediately raised questions for Daniel Posner, owner of Grapes The Wine Co., in White Plains, New York. Since wine shipments take about two weeks to cross the Atlantic, he wonders if a shipment arriving Monday will be affected.

“We are responding to what has become a very volatile situation,” Posner said.

Ron Kurnik owns Superior Coffee Roasting Co. in Sault Ste. Marie, Michigan, across the Canadian border. In addition to U.S. tariffs, Kurnik faced retaliatory tariffs from Canada for much of last year when exporting his coffee.

“It’s like a nightmare that we just want to wake up from,” said Kurnik, whose company has raised prices 6% twice since the tariffs took effect. Although he is happy with the Supreme Court’s decision, he doesn’t think he will ever get a refund.

A wide range of industries, including retail, technology and agriculture, used the Supreme Court’s decision to remind Trump of the impact his trade policies have on their businesses.

The Business Roundtable, a group that lobbies on behalf of more than 200 U.S. businesses, issued a statement encouraging the administration to limit tariffs to specific unfair trade practices and national security concerns.

In the retail sector, stores of all stripes have adopted different ways to offset the effects of tariffs: from absorbing part of the costs themselves to reducing expenses and diversifying their supply network. They nevertheless had to pass on certain price increases at a time when buyers are particularly sensitive to inflationary pressures.

Dave French, executive vice president of government relations for the National Retail Federation, the nation’s largest retail trade group, said he hoped lower courts would ensure “a transparent process” for refunding tariffs. This issue was not addressed in Friday’s ruling.

For the technology sector, Trump’s tariffs have caused significant problems. Many of its products are manufactured overseas or rely on imports of key components. The computer & The Communications Industry Association, which represents a broad range of technology companies employing more than 1.6 million people, expressed hope the move would ease trade tensions.

“With this decision behind us, we look forward to bringing more stability to trade policy,” said Jonathan McHale, the association’s vice president for digital trade.

Farmers, who have been hit by rising prices of equipment and fertilizer since the tariffs came into force, as well as reduced demand for their exports, have also spoken out.

“We strongly encourage the president to avoid using any other available authority to impose tariffs on agricultural inputs that would further increase costs,” said Zippy Duvall, president of the American Farm Bureau Federation.

The Supreme Court ruled 6-3 that the International Emergency Economic Powers Act did not give the president the power to tax imports, a power that belongs to Congress. But the decision only affects tariffs imposed under that law, so some industries won’t get any relief.

The decision keeps tariffs in place on steel, upholstered furniture, kitchen cabinets and bathroom vanities, according to the Home Furnishings Association, which represents 15,000 furniture stores in North America.

At Revolution Brewing in Chicago, the aluminum they use for cans costs as much as the ingredients in them because of Trump’s tariffs on metals that are not affected by the Supreme Court ruling. Although the cans are made in Chicago, the aluminum comes from Canada, said Josh Deth, managing partner of the brewery.

Tariffs are just one challenge for his business, which is also affected by volatile barley prices and slowing demand for craft beer.

“It all adds up,” he said. “The beverage industry needs help. We are being crushed by aluminum prices.”

Italian wine growers, hit hard by the tariffs, greeted the Supreme Court’s decision with skepticism, warning that the ruling could only increase uncertainty around trade with the United States.

The United States is Italy’s largest wine market, with sales tripling in value over the past 20 years. New tariffs imposed on the EU, which the Trump administration had initially threatened would rise to 200%, sowed fear throughout the industry, which persisted even after the United States reduced, delayed and negotiated them down.

“There is a more than likely risk that customs duties will be reimposed through alternative legal channels, compounded by the uncertainty that this decision could generate in trade relations between Europe and the United States,” said Lamberto Frescobaldi, president of the UIV, a trade association that represents more than 800 wine growers.

Elsewhere in Europe, the initial reaction focused on renewed upheaval and confusion over the costs faced by companies exporting to the United States.

Trump’s tariffs could hit pharmaceuticals, chemicals and automobiles, said Carsten Brzeski, an economist at ING bank. “Europe must make no mistake, this decision will not bring any relief,” he said. “The legal authority may be different, but the economic impact could be the same or worse.”

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Anne D’Innocenzio in New York; Dee-Ann Durbin in Detroit; Michael Liedtke in San Francisco; David McHugh in Frankfurt, Germany; Jonathan Matisse in Nashville, Tennessee; Adrian Sainz in Memphis, Tennessee; and Nicole Winfield in Rome contributed to this report.