Trump's 'Plan B' On Tariffs Is Taking Shape: It's More Tariffs

ETHReserveBank · 2026-02-20T23:27:40+00:00

President Trump plans to impose new tariffs, starting with a 10% global tariff, after the Supreme Court struck down previous tariffs. He aims to restore tariffs using different legal mechanisms, despite longer investigation times for specific cases. This move adds uncertainty to the economy.

ETHReserveBank

2026-02-20 23:27:40

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Key Takeaways

President Donald Trump said he is imposing new tariffs to replace the ones the Supreme Court just struck down, starting with a 10% global tariff.
Tariffs on specific countries and products will require his administration to carry out investigations.
Trump said he was determined to reinstate tariffs to their former levels.

When the Supreme Court struck down the majority of President Donald Trump’stariffs Friday, he lost little time revealing his backup plan: imposing more tariffs under different legal mechanisms from the one the high court ruled against.

The new tariff regime will begin with a global 10% tariff on all countries, Trump said at a press conference and in a social media post. The new import tax is similar to the 10% baseline reciprocal tariff he imposed on Liberation Day in April. However, it doesn’t rely on powers granted by the International Emergency Economic Powers Act, which the court ruled did not allow the president to impose tariffs.

Trump said he was using Section 122 of the Trade Expansion Act, which gives the president authority to impose tariffs to address trade imbalances for up to 150 days.

In addition, he said his administration was starting Section 301 investigations against several other countries. That provision allows the White House to impose tariffs in retaliation for unfair trade practices, but only after completing an investigation.

What This Means For The Economy

The Supreme Court’s ruling and Trump’s vow to impose more tariffs introduce a fresh dose of uncertainty into an economy where it was already difficult for businesses to predict trade policy.

Trump’s swift tariff action signaled his determination to continue using his preferred economic and foreign policy tool. But it also highlighted the limitations of his remaining tariff powers, since he can no longer use IEEPA.

Investigations under Section 301 can take months to complete. That’s in contrast to Trump’s freewheeling use of emergency tariff powers. Over the past year, Trump has frequently announced and then changed tariffs on social media posts and also used threats of tariffs as a negotiating tool.

“The administration retains the ability to re‑impose tariffs, but nothing grants the President the same broad power with immediate effect as IEEPA would have,” economists at Wells Fargo Securities said in a commentary.

Related Education

What Is a Tariff and Why Are They Important?

Trade Wars Explained: History, Benefits, and U.S.-China Example

The immediate result of the ruling is to lower the effective tariff rate paid by Americans. Wells Fargo estimated the overall tariff rate fell to 13% Friday from 16% before the action. Trump said he intends to raise tariffs back to their former level, if not higher.

“We have alternatives,” Trump said. “Great alternatives. Could be more money. We’ll take in more money, and we’ll be a lot stronger for it.”

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