The Trump administration introduced new tariffs shortly after taking office in 2025. For example, on February 1, President Donald Trump signed three executive orders imposing additional tariffs on imports from Canada, Mexico, and China. The tariffs affected various industries and sectors and raised concerns about trade relationships. The additional tariffs took effect on February 4 and targeted a broad range of imported goods.
Note that the executive orders introduced a 25 percent tariff on imports from both Canada and Mexico. A lower tariff rate of 10 percent is applied to energy resources from Canada. Imports from China faced an additional 10 percent tariff. These tariffs added to the duties previously imposed on Chinese imports under the Trade Act of 1974. The Trump administration signaled that trade policy would remain one of the main issues.
The Legal Basis for the Tariffs Under the Second-Term Trump Administration
The administration justified the tariffs using the International Emergency Economic Powers Act or IEEP. This law was enacted in 1977 and grants the president authority to address threats to national security and the economy. It allows immediate action without the need for investigations or review processes. This marked the first time this law had been used to impose tariffs.
President Trump declared a national emergency related to illicit substance trafficking. The administration cited fentanyl and synthetic opioid smuggling as a primary concern. The orders specifically mentioned failures by China to prevent the export of chemical precursors used in drug production. Similar concerns were raised about border security with Canada and Mexico.
Comparing the Previous Trade Actions of the First-Term Trump Administration
The Trump administration previously used Section 301 of the Trade Act of 1974 to impose tariffs on China. That law required investigations before implementation. Section 232 of the Trade Expansion Act of 1962 allowed for tariffs based on national security concerns but also required thorough review. The IEEP provided a faster alternative without requiring an investigation.
Furthermore, to support its decision, the first-term Trump administration referenced past trade and specific tariff actions. Note that President Nixon used the Trading With the Enemy Act to impose tariffs in 1971. That action survived a legal challenge and reinforced presidential authority in trade matters. The use of emergency powers for tariffs in 2025 introduced a new legal precedent.
Existing Criticisms, Possible Legal Challenges, and Potential Economic Impacts
Legal challenges to the new tariffs are likely. Federal courts have historically upheld presidential authority under the International Emergency Economic Powers Act. However, according to several legal scholars, the law does not explicitly grant the executive branch the power to impose tariffs. Any legal challenge would need to address how the law defines economic regulation.
The economic impact of the tariffs remains uncertain. Companies relying on imports may face increased costs. Consumers could experience higher prices for imported goods subject to the tariffs. Some companies may seek alternative suppliers to reduce expenses. The administration positioned the tariffs as a tool to protect American industries and national security interests.