Tariff Update: Key Developments in US Tariff Landscape

June 17, 2025 23:25:16

Recent Court Developments

On May 28, 2025, the U.S. Court of International Trade (CIT) issued a permanent injunction blocking the enforcement of several tariffs imposed under the International Emergency Economic Powers Act (IEEPA), ruling that the President Trump had exceeded his statutory authority. These included:

10% “Baseline” Tariff: An across-the-board tariff applied to goods from most countries except goods qualifying for United States–Mexico–Canada Agreement (USMCA) rules of origin (primarily Canada and Mexico).

Country-Specific “Reciprocal” Tariffs: Variable rates (up to 125%) imposed on 57 trading partners with persistent trade deficits. Most of these reciprocal tariffs are currently suspended.

“Fentanyl” Tariffs: A 25% tariff on certain goods from Canada and Mexico, and a 20% tariff on virtually all goods from China.

On May 29, 2025, the United States Court of Appeals for the Federal Circuit granted an administrative stay of the CIT’s decision, leaving the tariffs in force for the time during which it decides whether to issue a longer stay. As a result, the tariffs will remain in effect at least until the Federal Circuit’s briefing deadline of June 9, 2025, when the court is expected to decide on whether to extend the stay.

Tariffs NOT Affected

It's important to note that these court orders do not impact the following tariffs, which remain in effect:

Section 232 Tariffs: These include tariffs on specific sectors like steel, aluminum, and autos. Anticipated future Section 232 tariffs on pharmaceuticals, critical minerals, and semiconductors/smartphones are also unaffected.

Section 301 Tariffs on China: Imposed during President Trump’s first term (beginning in 2018) under Section 301 of the Trade Act of 1974, these tariffs target specific Chinese goods in response to alleged unfair trade practices related to technology transfer, intellectual property, and innovation. They remain in place and are under ongoing investigation. There is an extension for exclusion for certain goods, e.g., GPU components, from May 31, 2025 to August 31, 2025.

White House Response and Future Outlook

As expected, the Trump administration has strongly criticized the CIT’s decision. Officials have indicated they will pursue every available avenue to maintain or reinstate these tariffs and are considering a “plan B” to maintain similar levies under more established tariff authorities if the IEEPA-based tariffs are ultimately struck down. This could involve using Section 122 of the Trade Act of 1974 for temporary baseline tariffs, while pursuing Section 301 to reintroduce higher “reciprocal” tariffs through formal investigations.

What This Means

For the time being at least, the temporary stay by the Court of Appeals means the IEEPA-based tariffs remain in effect, at least until June 9, 2025.

Important Note: This communication, which we believe may be of interest to our clients and friends of MagStone Law, LLP, is for general information only. It is not a full analysis of the matters presented and should not be relied upon as legal advice. This may be considered attorney advertising in some jurisdictions.