Stand-off! Trump's New 'Volatile' Tariff Could Be Scrapped Again

Jakarta, CNBC Indonesia - A group of U.S. states has filed a lawsuit against President Donald Trump’s new import tariff, imposed after the Supreme Court struck down the reciprocal tariffs last month. This represents another hurdle for Trump, as tariffs are his signature policy. The suit was filed by the attorneys general of New York, California, Oregon, and other states. They contend that Trump ‘once again used tariff authority he does not possess’ in imposing a 10% tariff after the previous tariff was declared illegal. ‘Because this tariff violates the law, the court must rule that the tariff is invalid and order refunds,’ said the group of 24 states in their filing to the U.S. Court of International Trade, cited by AFP, on Friday (6 March 2026). The new 10% tariff in effect now can be applied for up to 150 days unless extended by Congress. Trump has threatened to raise the tariff to 15% and his administration is pursuing more permanent measures. Specifically, the states allege that Section 122 of the 1974 Trade Act does not authorize such large and ever-changing tariffs. They say the Act was designed to permit only limited tariffs to address issues such as a significant balance of payments deficit. The situation, they say, is not one the United States faces today, making Trump’s basis illegal. The Act also requires that tariffs not be applied in a discriminatory manner. And the discriminatory actions alleged in the suits are what Trump is accused of. ‘The new tariff excludes many goods from Canada, Mexico, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua,’ said New York Attorney General Letitia James in a statement. ‘The tariff also includes 84 pages of exemptions for specific products,’ she added. ‘Once again, the President Trump is ignoring the law and the Constitution to effectively raise taxes on consumers and small businesses,’ she asserted. Meanwhile, California Attorney General Rob Bonta said in a separate statement that the state has repeatedly challenged the imposition of ‘illegal’ Trump tariffs. Because this matter is very important for California residents who are already struggling with the cost of living, where tariffs push inflation. Earlier, the Supreme Court decision did not affect the tariffs in some sectors such as steel and aluminium. But it opened the door for large refunds as importers seek to recover revenue lost. The reciprocal tariffs scrapped by the Supreme Court referred to the International Emergency Economic Powers Act, while the steel and aluminium tariffs in the US referred to Section 232 of the Trade Act of 1962. The tariffs now deemed illegal have generated more than US$130 billion (around Rp 2,184 trillion) for the US government through to the end of 2025.