WASHINGTON, D.C. — In a landmark 6–3 decision Friday, the U.S. Supreme Court ruled that former President Donald Trump’s sweeping tariff program was unconstitutional, concluding that the law he relied on — the International Emergency Economic Powers Act — does not actually give the president authority to impose broad import taxes without clear congressional approval.

The ruling invalidates a major portion of the tariffs the administration imposed throughout 2025 and early 2026, potentially opening the door for companies to seek hundreds of billions of dollars in refunds and altering the economic landscape for businesses and households alike.

What the Court Actually Decided

At issue in Learning Resources v. Trump was whether the Emergency Powers Act — a sanctions statute originally designed to give the president authority in narrow crisis scenarios — could be used to levy widespread tariff duties on virtually all imported goods.

In Friday’s opinion, Chief Justice John Roberts wrote that the statute’s text does not grant power to set tariffs, saying Congress must speak clearly if it intends to delegate such sweeping authority.

Justices in the majority stressed that tariff authority is clearly assigned to Congress under the Constitution, and past decades of tariff law reflect this legislative control. Several justices rejected the government’s claim that broad “regulate importation” language included tariff power, concluding instead that the president must act under specific trade statutes if tariffs are to be imposed.

Immediate Market and Business Reactions

Financial markets reacted quickly Friday.

  • Retail and consumer stocks rallied, with many consumer-oriented companies seeing share prices jump in early trading as tariff-sensitive costs were expected to ease.

  • The broader S&P 500 also saw modest gains before adjusting, reflecting optimism about lower input costs for businesses.

But the markets also signaled ongoing uncertainty. Bond traders pushed yields higher — a sign of concern about potential impacts to the federal budget if large tariff refunds are issued.

For many companies, the ruling doesn’t immediately drop costs or guarantee refunds — and some business groups are already warning that the path to reimbursement could be long and complicated.

Tariffs, Refunds and Legal Uncertainty

One of the biggest unanswered questions is how and when the government might refund tariffs that were collected under the now-invalidated authority.

Estimates suggest that more than $175 billion in tariff revenue collected since early 2025 could be subject to refund claims — a massive obligation that would exceed some federal department budgets and complicate fiscal planning.

Courts and lower tribunals will now face a flood of litigation as importers argue over eligibility and procedures, and many distributors and retailers fear they may miss out because they are not formally designated “importers of record.”

Some businesses are negotiating directly with importers or threatening to halt supply chain partnerships unless they receive a share of any refunds, adding to commercial uncertainty.

Concrete Impact on Prices and Households

Perhaps the most important question for readers is not legal doctrine but cost: how did tariffs affect everyday prices and household expenses in 2025?

Measured price impacts:
Academic and Federal Reserve research shows that tariffs did raise consumer prices in 2025 in a significant, measurable way — though not evenly across all goods.

  • Imported goods prices — especially durable and core goods — rose noticeably above trend throughout 2025 as tariff policies were implemented, suggesting that higher costs were passed along in part to consumers.

  • Independent economic research finds that, on average, nearly 90 percent of tariff costs were ultimately borne by U.S. firms and households, not foreign producers. This means most of the cost burden stayed inside the U.S. economy.

Household expenses:

  • Estimates from public policy organizations put the average household’s tariff-related cost increase in 2025 at roughly $1,000, with many projections even higher as price increases rippled through supply chains.

  • Some independent research suggests even larger impacts over time, with tariff effects adding several hundred to more than a thousand dollars per family depending on consumption patterns and product mix.

Put simply: tariffs didn’t crash the economy, but they acted like a broad, subtle tax on goods Americans buy every day, gradually shifting costs into higher retail prices.

Business Costs and Supply Chain Strain

For businesses — especially small and medium-sized firms — tariffs meant higher costs for inputs, squeezed profit margins, and pricing pressures that complicated hiring and investment decisions.

Tariffs on imported intermediate goods — materials, components, parts — raised production costs, particularly in manufacturing sectors. Retailers often faced a choice between absorbing the hit or passing it on to consumers, a dilemma that lowered margins in some cases and raised prices in others.

Many smaller businesses also complain that ongoing tariff uncertainty made it harder to plan inventory levels and negotiate longer-term supplier contracts.

Consumer Relief and What Comes Next

The Supreme Court ruling won broad praise from consumer advocates and lawmakers who argued tariffs were driving up costs for families already dealing with high prices. Senate Democrats in some states welcomed the ruling as a step toward stabilizing markets and protecting household budgets.

On the other hand, tariffs remain in place where they are tied to other legal authorities not affected by the court decision, and some policymakers say they will pursue new legislative avenues or use different statutes to reimpose trade duties.

That means uncertainty remains in U.S. trade policy — and consumers may not see immediate price drops even if tariffs are rolled back. Businesses may be cautious about lowering prices until they have clarity on refund flows and future policy direction.

Bottom Line

The Supreme Court’s ruling is a disruptive reset in U.S. trade policy.

  • It invalidated broad tariffs that had been a drag on household budgets and business costs.

  • It creates legal chaos over refunds that could stretch for years.

  • And it leaves the broader future of U.S. tariff strategy unsettled.

But for everyday Americans, the most meaningful takeaway is this: tariffs helped push prices up in 2025, acting like a hidden cost on goods at stores and online. The court’s decision may ease that burden over time — but consumers and companies will feel the aftereffects long after today’s headlines.