TWN Info Service on WTO and Trade Issues (Feb26/22)
24 February 2026
Third World Network

Trade: Trump raises US global tariff to 15% after Supreme Court blow
Published in SUNS #10386 dated 24 February 2026

Geneva, 23 Feb (D. Ravi Kanth) — United States President Donald Trump on 21 February raised tariffs from 10% to 15% on imports from every country under Section 122 of the US Trade Act of 1974.

This move came after the US Supreme Court struck down President Trump’s signature trade initiative of reciprocal tariffs, which had wreaked havoc in the global trading system for many months.

(At the time of writing the 15% tariff announced on President Trump’s social media account has not been officially published.)

Tariffs under Section 122 are valid for only 150 days, and it is intended to serve as a “bridge” while the Trump administration determines how to maintain the seemingly extortionary tariff level originally set through the reciprocal tariffs.

Following the Supreme Court ruling, which remained silent on the refund of duties collected under the International Emergency Economic Powers Act (IEEPA), US Treasury Secretary Scott Bessent said the administration is not going to refund the approximately $124 billion in duties already collected.

In an interview with CNN on 22 February, he stated that the administration will let the lower courts decide the issue. (See interview below.)

The reciprocal tariffs were announced as “Liberation Day” tariffs on 2 April last year, targeting the alleged illicit supply of fentanyl by Mexico, Canada, and China, as well as the persistent US trade deficits that purportedly led to de-industrialization in America.

With the edifice of the reciprocal tariffs brought down by a majority opinion of six justices of the highest court in the United States, President Trump appeared to go into a tizzy.

He rebuked the majority opinion while simultaneously announcing a 10% universal tariff on 20 February.

Within 24 hours, President Trump hiked the tariff to 15% under what is called Section 122 of the US Trade Act of 1974, creating more turmoil and uncertainty in the global trading system, said analysts.

Justifying his latest action – the 15% tariff – on his Truth Social website, the seemingly ruffled President wrote on 21 February: “Based on a thorough, detailed, and complete review of the ridiculous, poorly written, and extraordinarily anti-American decision on Tariffs issued yesterday, after MANY months of contemplation, by the United States Supreme Court, please let this statement serve to represent that I, as President of the United States of America, will be, effective immediately, raising the 10% Worldwide Tariff on Countries, many of which have been “ripping” the US off for decades, without retribution (until I came along!), to the fully allowed, and legally tested, 15% level.”

He continued: “During the next short number of months, the Trump Administration will determine and issue the new and legally permissible Tariffs, which will continue our extraordinarily successful process of Making America Great Again – GREATER THAN EVER BEFORE!!! Thank you for your attention to this matter. President DONALD J. TRUMP.”

COURT RULING

Briefly, at the heart of the Court’s decision lies a simple constitutional principle: the power to tax belongs to Congress, not the executive.

The majority explicitly rejected the Trump administration’s reliance on the IEEPA to unilaterally impose tariffs on imports from all foreign countries entering the American market.

The highest Court reminded the executive branch that the “Framers” – having just fought a revolution over taxation without representation – gave Congress “alone… access to the pockets of the people.”

Six justices – Chief Justice John Roberts, and Justices Sonia Sotomayor, Elena Kagan, Neil Gorsuch, Amy Coney Barrett, and Ketanji Brown Jackson – ruled that the IEEPA does not grant tariff authority.

They affirmed that the word “regulate” in the statute does not encompass the power to tax imports.

The dissent, written by Justice Brett Kavanaugh, took a narrower view, observing that, “The Court says nothing today about whether, and if so how, the government should go about returning the billions of dollars that it has collected from importers.”

The case against the reciprocal tariffs was first brought by several American business groups and later joined by 12 US states.

According to the Supreme Court’s ruling, the Trump administration could bring the matter to Congress – where Republicans dominate both the House and the Senate.

For some inexplicable reasons, President Trump may hesitate for fear of failing to muster sufficient support, according to analysts and media reports.

Even US Vice-President JD Vance denounced the ruling, calling it “lawlessness…  plain and simple.”

According to a news report in China’s Global Times, it is reported that multiple outlets, including the Associated Press, described the latest escalation as another sign of President Trump’s unpredictable use of tariffs – a tool he frequently deploys to reshape global trade rules and exert international pressure.

The US is deeply intertwined with global trade and supply chains, and the Trump administration’s arbitrary use of tariffs has created policy confusion that shocks global commerce and ultimately harms both its trading partners and itself, a Chinese expert said, according to the Global Times.

It appears that some White House staff members were caught off guard by the tariff increase, people familiar with the matter said. It came less than 24 hours after the president had announced his 10% tariff rate, the New York Times reported.

The president’s efforts to restore and maintain the tariffs underscored the economic volatility ahead, the Global Times report suggested.

The tools he is left with are less nimble than the sweeping authority he had claimed under emergency powers and will be subjected to fresh legal challenges, according to Bloomberg.

The action means that US businesses will have to pay a 15% tariff to import most goods into the US under Section 122 of the Trade Act of 1974, the BBC reported.

It is well recorded that for months, countries have borne the brunt of President Trump’s aggressive trade policy, which was justified on rather dubious grounds ranging from combating the flow of illicit fentanyl to protecting and rebuilding American industry.

CNN INTERVIEW

In the interview with CNN’s Dana Bash, the US Treasury Secretary Bessent said the Court’s ruling is a “narrow” ruling, adding that it remained silent on the refund of monies collected under IEEPA.

“The Supreme Court remanded it down to a lower court, and you know, we will wait till we hear what they say [on the refund of duties collected under IEEPA], but that could be weeks or months when we hear them.”

When it was pointed out that the Justice Department had committed in court to returning the funds, the Treasury Secretary said, “It is not up to me. It is up to – not you, not you. It is not up to the administration, it is up to the lower court. Let’s just be clear on that.”

Bessent said that the current tariff of 15% “under Section 122 authority is good for 150 days” and “during that time, we will do a study on Section 232 [which was dismissed by a World Trade Organization dispute settlement panel] which will be done by the Commerce Department, [and] Section 301, which will be done by USTR.”

“So during that time,” the Treasury Secretary said, “it is very likely that those studies will result in higher 232s, higher 301s, and it will get us back to the same tariff level [under IEEPA].”

Aside from China, a few countries stood up against the reciprocal tariffs, with varying levels of opposition.

If there was a united front of key developing countries like China, India, Brazil, and South Africa against the reciprocal tariffs, Washington could have been brought to reconsider its move, said analysts.

The reciprocal tariffs are an alleged violation of the core provisions of the Marrakesh Agreement, such as Article I on most-favoured-nation (MFN) treatment and Article II on binding tariff commitments.

China launched a trade dispute at the WTO against the allegedly illegal unilateral reciprocal tariffs, and the dispute is going through the motions at this juncture.

To recall, even the other provisions being deployed by the Trump administration, like Section 232 national security provisions for levying 25% sectoral tariffs on several items, are inconsistent with the WTO rules, according to a ruling issued by a WTO dispute settlement panel.

Given the dysfunctional Appellate Body, the issue will remain in proverbial cold storage for years to come, as there is no chance of bringing the Appellate Body back to life because of Washington’s continued blocking of a proposal tabled by Colombia on behalf of 130 countries calling for the start of the selection process to fill the vacancies on the Appellate Body, as per several reports in the SUNS.

At a time when the WTO Director-General, Ms Ngozi Okonjo-Iweala, the custodian of the multilateral trading system, is required to call out the illegality of the reciprocal tariffs, she chose to adopt an ambivalent position, according to media reports.

For example, at the recent World Economic Forum meeting, Ms Okonjo-Iweala told CNN that the Trump administration’s unilateral reciprocal tariffs are outside the trade body’s remit, as reported in the SUNS.

In a similar vein, at the Munich Security Conference held after the Davos meeting, she said that the unilateral reciprocal tariffs imposed by President Trump may have had “some impact” with “less than 1% of GDP growth hit.”

However, she held China responsible for its embrace of an export-led growth model that generated a $1.2 trillion trade surplus last year.

The DG has so far not issued any statement against the latest move by Washington of a 15% global tariff on all WTO members.

IMPACT OF 15% TARIFF

While there appears to be a broad sigh of relief that the 15% tariff seems to be beneficial for several countries in the Asian region, particularly in South Asia and South-East Asia, it is somewhat misleading, said a former Indian tariff negotiator who played an important role in the WTO tariff negotiations at different stages.

According to the Indian tariff negotiator, the latest US tariff of 15% has changed the level-playing field and made it more asymmetrical, and it could benefit China more than other countries in the region.

The reason being that the 44% tariff imposed by the US on Chinese goods (34% reciprocal tariff plus 10% global tariff) would come down to 15%, along with the sectoral tariffs applied on all countries.

“Then China will get a tremendous advantage and you cannot simply compete with Chinese products in the American market.”

While the earlier reciprocal tariff of 25% on India will be brought down to 15%, in China’s case it will come down from 40-odd percent to 15%, the negotiator argued.

It remains to be seen what India is going to do, as it is reportedly sending its negotiators to Washington this week to finalize an interim trade deal.

While the Indian commerce minister said that New Delhi is studying the impact of the Supreme Court ruling on one side, it is simultaneously sending its negotiators to Washington, on the other, according to media reports.

Just a day before the Supreme Court ruling, President Trump and Indonesian President Prabowo Subianto signed a document that effectively imposes sweeping conditions on Jakarta.

According to a White House fact sheet issued on 19 February, Indonesia “will eliminate tariffs on over 99% of US products, exempt American companies from local content requirements, and accept US federal safety standards over its own.”

It has even agreed to support a permanent moratorium on customs duties on electronic transmissions at the WTO.

India’s commerce minister insists that New Delhi has protected its sensitive agricultural lines and safeguarded national interests. But the fine print remains rather murky.

If the Indonesia deal is any indication, “protecting interests” may prove to be a euphemism for prying open markets under duress, this writer wrote in the Indian internet publication The Federal on 20 February.

The 25% “reciprocal tariff” on Indian goods has been reduced to 18% – and not eliminated.

(The position as to date is that while India will eliminate or reduce its tariffs on all US industrial goods and a wide range of US agricultural and food products, the US will keep all its MFN tariffs intact and will only lower the so-called “reciprocal tariffs”, bringing them down from 25% to 18%, and now to 15%.)

In return, New Delhi has agreed to eliminate or reduce tariffs on a wide range of American industrial and agricultural products, including allowing genetically modified items like soy oil containing 94% GM elements, and dried distillers’ grains containing GM ingredients used for making ethanol that it had long resisted.

It has signaled its willingness to align with US national security concerns, including a commitment to halt purchases of Russian oil – prompting sharp criticism from the Russian foreign minister in response to President Trump’s order referenced in the White House fact sheet.

New Delhi has also opened the door to likely binding commitments on digital trade rules that would curtail its regulatory autonomy.

Indonesia – alongside India and now Bangladesh – had been among the foremost opponents of the moratorium on customs duties on electronic transmissions. Yet Jakarta has now agreed to Washington’s demand for a permanent moratorium.

The India “deal is on.” In addition to the 15% tariff under Section 122, the US is also continuing with sectoral tariffs on several items under Section 232 national security provisions.

President Trump insists that the “deal is on.” But with the legal basis for the original tariff threat being struck down, India must ask: why rush?

The government of Narendra Modi stands at a proverbial crossroads. On one side, the American judiciary has offered a constitutional shield – a chance to demand that any agreement be fair, reciprocal in spirit rather than merely in name, and grounded in mutual benefit rather than executive overreach.

On the other side, the Trump administration is threatening to deploy alternative legal tools to achieve similar coercive ends.

Meanwhile, the Brazilian President, Luiz Inacio Lula da Silva, who is currently on a visit to India, on 22 February expressed relief over the 15% tariff.

President Lula reportedly said that he “was relieved that I didn’t rush into doing things hastily,” when it came to signing a trade deal with the US.

The latest move by the US to impose a 15% tariff “provided relief for many countries who were previously charged 50 to 40 percent [Brazil was charged 40% tariff],” President Lula said.

In short, the latest unilateral action by the Trump administration underscores a volatile and legally contentious period in global trade.

President Trump has insisted that his deals are “on” and is rapidly deploying alternative legal tools to maintain pressure. For nations like India, the Supreme Court ruling offers a potential constitutional shield and a reason to pause, but the immediate political and economic pressure from the White House to finalize agreements remains intense, said analysts, who asked not to be quoted.

The long-term impact will depend on whether other nations can find the unity to uphold the rules-based system or continue to be picked off one by one. +