U.S. readies new tariffs as Trump's 10% global levy to expire
The United States' current 10% global tariff, imposed under Section 122 of the Trade Act, 1974, is approaching its statutory 150-day expiry
The US administration is preparing new tariff measures as this global levy nears the end of its authorised period
The Section 122 tariff was imposed in February 2026, immediately after the US Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) does not authorise broad, open-ended tariffs
Section 122 permits only a temporary import surcharge, capped in duration unless Congress separately extends it, forcing the administration to seek alternative statutory authority for tariffs going forward
US Tariff Authorities — IEEPA, Section 122, Section 301, and Section 232
US presidents do not have a single, general power to impose tariffs; each tariff action must be traced to a specific statute, each with different procedural limits, duration caps, and standards of review. The transition from IEEPA-based tariffs to Section 122 tariffs in 2026 illustrates how the choice of legal authority shapes how long a tariff can last and how vulnerable it is to being struck down.
Key Details
- IEEPA (International Emergency Economic Powers Act, 1977) was used by the US administration for the April 2025 "reciprocal tariffs" and separate fentanyl-related tariffs; in Learning Resources Inc. v. Trump (February 20, 2026, 6-3), the Supreme Court held that IEEPA does not authorise the imposition of sweeping tariffs, striking both down
- Section 122 of the Trade Act, 1974 allows the president to impose a temporary import surcharge (used at 10%, since reported to have been raised to 15%) to address balance-of-payments concerns, but strictly caps such action at 150 days unless Congress votes to extend it — this was the first-ever invocation of Section 122 for this purpose
- Section 301 of the Trade Act, 1974 allows the US Trade Representative to act against specific "unreasonable" or "discriminatory" foreign trade practices, including through country-specific investigations (used separately in 2026 against 60 economies, including India, over forced-labor import-ban enforcement)
- Section 232 of the Trade Expansion Act, 1962 permits tariffs justified on national-security grounds, historically used for sector-specific measures such as steel and aluminium
Because the current 10% levy rests on Section 122's hard 150-day limit rather than the now-discredited IEEPA, the US administration must either seek Congressional extension or shift to a different statutory basis (such as Section 301 or 232) to sustain broad tariffs beyond expiry — explaining why "new tariffs" are being readied even as the current levy lapses.
Judicial Review of Delegated Trade Power — Learning Resources Inc. v. Trump (2026)
The Supreme Court's February 2026 ruling is a separation-of-powers decision: it held that Congress's delegation of emergency economic powers to the president under IEEPA does not extend to imposing tariffs, since IEEPA does not use the word "tariff" or "duty" and Congress has separately delegated tariff-setting power through other, more specific statutes (including Section 122, 301, and 232).
Key Details
- The ruling struck down both the April 2025 "reciprocal" tariffs (imposed on most trading partners, including a baseline 10% and higher country-specific rates) and IEEPA-based tariffs linked to fentanyl trafficking
- A subsequent challenge to the replacement Section 122 tariffs was itself found unlawful by the US Court of International Trade in May 2026, indicating continuing litigation over the legal basis for US tariff actions
- The case illustrates the "major questions" style reasoning increasingly used by US courts to require clear statutory authorisation before the executive can exercise powers with major economic and political significance
- India's own constitutional analogue is the doctrine that delegated legislation must stay within the four corners of the parent statute (ultra vires review); Indian tariff-setting is governed by the Customs Tariff Act, 1975, under which the Union executive may modify duties only pursuant to specific statutory delegation (e.g., safeguard duties under Section 8B), subject to judicial review
The expiry of the Section 122 tariff, and the parallel finding by the Court of International Trade that even this replacement measure may be unlawful, shows the ruling was not a one-time setback but an ongoing constraint on how the US executive can use trade statutes — a live illustration of judicial review checking delegated economic power.
India's Exposure to Shifting US Tariff Authority
Because different US tariff tools have different legal durability, the specific statutory basis of any US tariff on India determines how long it can last and how it can be challenged. India experienced this directly through the rapid rise and partial rollback of IEEPA-based tariffs in 2025-26.
Key Details
- In August 2025, the US imposed a combined 50% tariff on Indian goods — a 25% "reciprocal" tariff plus an additional 25% tariff explicitly linked to India's continued purchase of Russian oil — both under IEEPA authority
- These IEEPA-based tariffs on India were among those invalidated by the Supreme Court's February 2026 ruling in Learning Resources Inc. v. Trump
- Separately, since March 2026, Section 301 investigations into 60 economies (including India) over enforcement of forced-labor import bans have proposed additional tariffs of 10% to 12.5%, independent of the IEEPA/Section 122 tariff line
- India and the US have separately been negotiating a bilateral trade agreement, with a stated 2025 joint-statement goal of more than doubling bilateral trade to $500 billion by 2030
As the Section 122 global tariff expires, whatever "new tariffs" the US readies next will again need a specific statutory basis, and each such basis carries different implications and durability for India's trade relationship with the US.
- Learning Resources Inc. v. Trump: decided February 20, 2026, 6-3, Supreme Court struck down IEEPA-based tariffs
- Section 122 global tariff: 10% imposed February 2026, reportedly raised to 15%; capped at 150 days absent Congressional extension — the first-ever use of Section 122 for this purpose
- US Court of International Trade found the replacement Section 122 tariffs unlawful: May 2026
- Peak US tariff on Indian goods under IEEPA (August 2025): 50% (25% reciprocal + 25% linked to Russian oil purchases)
- Section 301 investigations into 60 economies (including India) over forced-labor import-ban enforcement: initiated March 2026; proposed tariffs of 10-12.5%
- India-US bilateral trade target set in a February 2025 joint statement: $500 billion by 2030