Supreme Court Strikes Down Some Tariffs — But Trade Costs Are Far From Over
One ruling down. Section 301 tariffs? Still very much alive.
The U.S. Supreme Court’s February 2026 decision invalidating tariffs imposed under the International Emergency Economic Powers Act (IEEPA) has meaningfully changed the trade landscape for retail and CPG operators. The Court held that the executive branch lacked sufficient congressional authorization under IEEPA to impose broad emergency tariffs, effectively removing a category of duties that had been a significant cost driver for many importers.
However, a number of operators are misreading the practical scope of the ruling. The decision addressed only IEEPA-based tariffs. It did not affect Section 301 tariffs on Chinese imports, which are authorized under separate trade statutes and remain fully in effect. Categories such as apparel, footwear, electronics, furniture, and many consumer goods continue to face meaningful import duties under Section 301 — often ranging from 7% to 25% depending on product classification.
Chart: Remaining Section 301 tariff rates by product category, compared to total pre-ruling tariff stack.
The ruling has also introduced a new layer of planning uncertainty. The current administration has already signaled its intent to pursue alternative legal mechanisms for trade restrictions, including expanded use of Section 122, Section 232, and new Section 301 investigations. Finance teams should resist the temptation to treat the ruling as a signal that tariff risk has been resolved.
Finance and procurement leaders should focus on the following actions now:
• Recalculating landed cost assumptions to reflect the current tariff environment
• Reviewing HTS classifications and confirming tariff exposure by product category
• Building multiple future tariff scenarios into financial models
• Evaluating supply chain diversification strategies
• Identifying potential refund opportunities for previously paid IEEPA tariffs
Bottom Line: The Supreme Court ruling reduced some tariff exposure, but trade costs and policy uncertainty remain significant financial risks for retail and CPG operators.