A recent ruling by a federal appeals court has invalidated the Trump administration’s use of the International Emergency Economic Powers Act (IEEPA) to impose increased tariffs, a decision that has significant implications for the retail sector.
Court ruling challenges tariff authority
On August 29, 2025, the US Court of Appeals for the Federal Circuit affirmed a lower court’s decision, concluding that the tariffs imposed under the IEEPA exceeded the authority granted to the President.
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The court’s opinion stated that the tariffs did not meet the statutory requirements necessary for their implementation under the IEEPA. This ruling has temporarily invalidated the tariffs, pending potential further appeals.
Retail industry expresses concern
The National Retail Federation (NRF) has expressed concern over the uncertainty created by the ongoing legal battles surrounding the tariffs.
Jonathan Gold, NRF’s Vice President of Supply Chain and Customs Policy, highlighted the challenges retailers face in planning and maintaining supply chain continuity amidst such instability.
He noted that the tariffs have led to increased costs for retailers, which could ultimately result in higher prices for consumers.
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By GlobalDataPotential economic impact
A study by the NRF in November 2024 estimated that proposed tariffs on imports could reduce American consumers’ spending power by between $46 billion and $78 billion annually.
The study focused on six consumer product categories, including apparel, toys, and household appliances, and found that the tariffs would lead to higher prices for these goods.
The recent court decision may provide some relief to consumers and retailers by potentially removing the tariffs. However, the situation remains fluid, and the possibility of further legal challenges means that the final outcome is still uncertain.
As the legal proceedings continue, stakeholders in the retail industry are closely monitoring developments, hoping for a resolution that will provide greater stability and predictability for businesses and consumers alike.
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