Lawyers for small businesses and states challenging President Donald Trump’s authority to impose sweeping tariffs on almost all goods imported into the United States urged the Supreme Court on Monday to leave in place rulings by lower courts that struck down most of the tariffs. One group of small businesses told the justices that the tariffs “have equated to the largest peacetime tax increase in American history,” while another contends that the tariffs “upend[] a century of trade law.”

Trump’s executive orders relied on a federal law, the International Emergency Economic Powers Act, that gives the president the power to take action to “deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States” if he declares a national emergency “with respect to such threat.” When there is a national emergency, the president under IEEPA can “regulate . . . importation” of “property in which any foreign country or national thereof has any interest.”

In Washington, D.C., a pair of small businesses that make educational toys and products went to federal court to challenge the tariffs. The companies, Learning Resources and hand2mind, contend that the tariffs will cost them $100 million this year – nearly 45 times as much as they paid during 2024