Trade Court Rules Trump’s 10% Global Tariff Is Illegal

A panel of federal judges on Thursday found President Trump had violated the law when he imposed a 10 percent tariff on most U.S. imports, dealing yet another legal setback to the White House in its efforts to wage a trade war without the express permission of Congress.

In a split ruling, the Court of International Trade found that Mr. Trump had wrongly invoked a decades-old trade law when he applied those duties beginning in February. The president imposed the levies after his previous set of punishing tariffs was struck down by the Supreme Court.

The decision appeared to place, for now, new limits on Mr. Trump’s trade powers, which he has wielded aggressively in hopes of resetting relationships with allies and adversaries, raising new revenue and encouraging more companies to make their products in the United States.

While the court declared Mr. Trump’s tariffs to be illegal, it only explicitly blocked their collection from small businesses and some states that had sued over their legality. It remained unclear how the administration would interpret that order, though it is widely expected to appeal.

The ruling marked a major setback for Mr. Trump as he prepares to travel to China next week to meet Xi Jinping, its leader, about trade. Tariffs are expected to be a major topic on the agenda, and the court decision could undercut the president’s leverage.

The decision also raised the likelihood that Mr. Trump might once again have to pay back money collected from the illegal duties. A refund process is already underway for the roughly $166 billion collected under Mr. Trump’s prior set of sweeping tariffs.