America has implemented 10% global tariff with immediate effect. A White House official has confirmed that this tariff will remain in effect until another legal authority is implemented. India will also be included among the countries paying 10% tariff under this new system. When the official was asked whether India would have to pay 10% tariff and whether it would replace the old tariff imposed under IEEPA (International Emergency Economic Powers Act), he clearly said, ‘Yes, 10 percent will remain in force until any other authority comes into force.’ The official also advised all trade partners to abide by the trade agreements made with the US.
According to ANI report, this decision has come at a time when the US Supreme Court, with a majority of 6-3, gave a big blow to the Trump administration. The court said that under the IEEPA Act of 1977, the President does not have explicit authority to impose blanket import duties. According to the Constitution, this power rests with Congress. Chief Justice John Roberts along with Neil Gorsuch, Amy Coney Barrett and three justices joined the majority. Justices Samuel Alito, Clarence Thomas and Brett Kavanaugh dissented and supported the administration’s powers. This decision has invalidated billions of dollars of “reciprocal” and tariffs. It is estimated that the government may have to face refund claims ranging from 130 to 175 billion dollars.
Trump called the decision ludicrous
President Trump described the Supreme Court’s decision as terrible and ludicrous. He said, ‘The court said that I cannot take even 1 dollar under IEEPA. I can close down business, end the country’s trade system, but can’t impose a $1 fee, how ridiculous is this?’ Trump alleged that the court is influenced by foreign interests and said that other countries are happy with this decision, but will not dance for long.
New tariff under section 122
After the Supreme Court’s decision, Trump announced signing an executive order to impose a 10 percent global tariff under Section 122 of the Trade Act of 1974. This provision allows for the imposition of a temporary tax of up to 15 per cent for 150 days, specifically to address the balance-of-payments deficit. Trump clarified that the tariffs already implemented under Section 232 (national security) and Section 301 (unfair trade practices) will remain in full effect.
Impact on India-US trade agreement
Trump said the ongoing India deal, which reduced reciprocal tariffs to 18%, would be maintained under the new legal process. This situation could be complicated for India, because the 10% global tariff will be applicable on top of the existing duties. This may affect exports, especially steel, aluminium, auto parts and textile sectors.
