In a pair of consolidated Supreme Court cases—Learning Resources, Inc. v. Trump and Trump v. V.O.S. Selections, Inc.—the Justices will soon decide whether the President may impose tariffs under the International Emergency Economic Powers Act of 1977 (IEEPA), despite the existence of a separate and vast body of detailed trade legislation on topic. This post explains why we think this answer is ‘no.’ We address the question at greater length in a recently-filed brief as amici curiae.
The government’s case, supported by a handful of amici, is straightforward. The traditional law of war recognized a combatant’s right to curtail trade with its enemy and did not rule out tariffs or other taxes as an alternative to an absolute ban. The Trading with the Enemy Act of 1917 (TWEA), which codified the traditional law, embraced this background, even if it was silent on the point. In 1975, the Court of Customs and Patent Appeals in United States v. Yoshida Int’l read a tariff authority into TWEA’s grant of the power to regulate imports. Congress copied the statutory phrase interpreted in Yoshida when it enacted IEEPA in 1977.
Our brief argues that each of these points is wrong. The United States sometimes exercised taxation power over occupied enemy territory as part of its status as a law-of-war occupier.[1] No President ever understood TWEA as conveying a power to impose tariffs or other taxes. The Court of Customs and Patent Appeals was confused about this point and made some sweeping declarations about emergency powers, but its decision rested on presidential authority under trade law. Moreover, Congress meant IEEPA to represent a break between peacetime authorities and war powers and saw monetary exactions as based on a takings power that IEEPA denies the President except during time of war. Later enactments confirm this point.
IEEPA Section 203(a)(1)(B)
President Trump bases his authority to impose tariffs on section 203(a)(1)(B) of IEEPA, which partly tracks the language of section 5(b) of the much-amended TWEA. Despite sharing some common language, TWEA section 5(b) and IEEPA proceed from different constitutional foundations, serve different purposes, and work within different legal contexts.
IEEPA provides that to “deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States,” the President may proclaim a “national emergency.” Upon that event, IEEPA delegates to the President power to:
investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States.
To understand why the highlighted text does not grant tariff authority, we look at (1) TWEA as it evolved from World War I through the Cold War; (2) the 1977 statute that both created IEEPA and amended TWEA; (3) two later statutes, including a narrowly-applicable addition to IEEPA, that clarify the limits of the powers granted in section 203(a)(1)(B); and (4) other statutes that expressly delegate tariff powers to the president.
Wartime v. Peacetime Powers and Revenue-Raising v. Regulatory Powers
TWEA, enacted in 1917 after the United States entered World War I, authorized the president to employ certain war powers; this legislative grant was consistent with the Constitution’s Article I, section 8, clauses 10–13, and the international law of war. TWEA authorized the president, among other things, to regulate imports and exports, to ban or selectively license trade in goods with enemy states or enemy nationals, to regulate cross-border financial transactions, and to sequester enemy-owned property in the United States. None of the provisions of TWEA in 1917 authorized confiscation of enemy property or any kind of taxation. Most, but not all, of the provisions of TWEA expired by their express terms when the war ended. Congress in separate statutes raised tariffs and imposed other kinds of taxes to meet the war’s exigencies.
Section 5(b) of TWEA was not expressly limited to wartime or transactions involving enemy aliens. In 1933, creative lawyers in the Roosevelt administration used this provision to support the President’s declaration of a “bank holiday”—temporary closures and other measures to stop runs on bank and gold leaving the country. Through the Emergency Banking Relief Act of 1933, Congress extended the statute to national emergencies, not just international conflicts.
Following the United States’ entrance into World War II, Congress amended section 5(b) of TWEA to add more powers to the President’s toolkit—including the power during war or national emergency to “regulate . . . any . . . importation or exportation of . . . any property in which any foreign country or national thereof has any interest,” and the power to “vest” and “liquidate[ ]” any foreign-owned property within U.S. jurisdiction “for the benefit of the United States.” But no president, during World Warr II or afterwards, relied on the “regulate . . . importation” language to impose tariffs. Without exception, Cold War TWEA sanctions, besides travel bans, involved trade embargoes and the sequestration of property, but not forfeiture or financial exactions.
We do not argue that section 5(b) absolutely ruled out tariff adjustments, even though it is interesting that no president ever asserted otherwise. The statute expressly allowed takings of alien-owned assets that result in the vesting of title in the United States. It might have been possible to argue that taxation could be a valid exercise of an inferred lesser-included power.
As it happened, between the 1930s and the enactment of IEEPA in 1977, Congress repeatedly enacted legislation delegating various kinds of tariff-adjusting powers to the president,[2] and presidents found these powers largely sufficient to address the deployment of tariffs to meet foreign policy or foreign economic challenges. When presidents desired more tariff-adjusting power, they asked Congress for it and typically got what they wanted. In 1971, when President Nixon imposed a short-term duty surcharge on imports, his lawyers (at his direction, according to the historical record) expressly tied the tariff to his authority under international law (the General Agreement on Tariffs and Trade, a provisionally applicable treaty to which the United States was a party) to respond to a balance-of-payments emergency. He rejected using TWEA because he did not want Japan, the principal target of the surcharge, to think that his administration regarded it as an “enemy.”
The 1977 Statute
Congress adopted IEEPA in 1977 to provide an exclusive basis for economic sanctions in foreign relations in the absence of a declared war. IEEPA followed other contemporary enactments that reclaimed for Congress foreign relations powers that presidents had exercised since the end of World War II. These include the use of force under the War Powers Resolution of 1973, the levying of tariffs authorized by the Trade Act of 1974, the expenditure of appropriated funds governed by the Congressional Budget and Impoundment Control Act of 1974, and the recognition of foreign sovereign immunities established by the Foreign Sovereign Immunities Act of 1976.
The 1977 enactment has three titles. The first amended TWEA to restrict its scope to instances of declared war. The second created IEEPA. The third amended the Export Administration Act of 1969, to clarify the President’s authority to regulate exports on national security grounds. The net effect of these provisions was to separate categorically the powers that the President may wield during a declared war and those available to address peacetime international challenges.
The 1977 Act rendered insupportable what previously would have been a problematic but not wholly frivolous argument, namely that language allowing the president power to “regulate . . . importation” of property implied a power to impose tariffs and other taxes. Although the “regulate . . . importation” language carried over into IEEPA, the power to vest title did not, killing any greater-power-includes-the lesser reading.[3]
We recognize that these are all technical, lawyerly arguments about statutory interpretation, not grand pronouncements about the constitutional balance of powers or the possible absence of good faith in the President’s determination of a national emergency. This, we believe, is a feature, not a bug. In times of heightened political contestation and insecurity about the health of U.S. public institutions, hardcore lawyering can point the way toward sensible, responsible solutions that do not inflame the already excessive passions of contemporary discourse.
[1] Professor Aditya Bamzai of the University of Virginia School of Law argues in an amicus brief in Learning Resources that the pre-1917 law-of-war background authorized the President to entirely prohibit trade with enemies, and therefore to tax trade as a lesser-included power. He further claims that TWEA and later IEEPA rested on congressional assumptions that this background can illuminate the meaning of the term “regulate.” As our brief explains, during the Mexican-American War, the Civil War, and the Spanish-American War, the Supreme Court recognized the validity of imposing some wartime tariffs and license taxes or fees, not otherwise authorized by regular trade and tax legislation, but only as exercises of the well-established Commander-in-Chief war power to temporarily administer occupied enemy territory. TWEA did not contemplate any such military occupation, and nothing in TWEA addressed this kind of executive-branch revenue raising. Needless to say, neither did IEEPA.
[2] Major statutes included the Reciprocal Trade Agreements Act of 1934, the Trade Expansion Act of 1962, and the Trade Act of 1974.
[3] Two later statutes confirm how limited the main provisions of IEEPA are. The post-9/11 USA PATRIOT Act of 2001, in section 106, amended IEEPA to add a limited confiscation authority in times of armed conflict, not just declared war. In the REPO Act of 2024, Congress authorized the vesting and use of Russia’s frozen assets for the benefit of Ukraine, demonstrating that vesting is not available under the main provision of IEEPA—the one at issue in the present dispute about tariffs.
Paul B. Stephan is the John C. Jeffries, Jr. Distinguished Professor of Law at the University of Virginia School of Law. He is a former counselor on international law in the United States State Department and previously served as special counsel to the General Counsel of general counsel in the Department of Defense. Professor Stephan regularly writes on international business, international dispute resolution, and comparative law.
Andrew Kent is the Joseph M. McLaughlin Professor of Law at Fordham University School of Law. He writes on topics including presidential power, foreign relations law, and economic sanctions.