Advancing American Freedom led a coalition of 11 other amici filing an amicus brief in Oregon v. Trump, a case challenging illegal tariffs from the executive branch. On the very day that the Supreme Court struck down his tariffs under the International Emergency Economic Powers Act (IEEPA), the President announced a global tariff claiming authority under Section 122 of the Trade Act of 1974, which allows the President to impose limited tariffs to address “large and serious United States balance-of-payments deficits.”
Section 122 has never been used for tariffs. In fact, Section 122 was obsolete as soon as it became law. A “balance-of-payments deficit” is a natural consequence of the fixed exchange rate system, which set the exchange rate for gold at $35 an ounce and was officially abandoned in 1976. A “balance-of-payments” deficit is not the same thing as a trade deficit.
Article I grants Congress and Congress alone the power to tax, but until Congress reclaims its own power or until the courts rule that the executive branch cannot wield the power to tax, the courts will be playing whack-a-mole as the President pivots from statute to statute.
“The President seeks to use the tariff power as a means of accomplishing his political agenda. But Section 122 does not allow the President to impose tariffs in response to trade deficits,” said AAF General Counsel J. Marc Wheat. “The Court should quickly issue a permanent injunction against the President’s Section 122 tariffs and should deny any subsequent motion to stay that injunction.”