A mission from God, with backup plans: Trump’s tariff tools aren’t out yet

A court ruling that seeks to block US President Donald Trump’s controversial “Liberation Day” tariffs is only a temporary obstacle and could be bypassed using other legal tools, analysts at Goldman Sachs Group Inc. said on Thursday.

The US Court of International Trade has halted 6.7 percentage points of levies introduced this year, Bloomberg reported cited Goldman Sachs analysts. The economists, in a note to clients, said the White House has several options to compensate for the setback by using alternative tariff mechanisms.

After the court order, the Trump administration responded immediately, announcing its decision to appeal the ruling. This move shifts the final decision on the tariffs to an appellate court and possibly even the US Supreme Court. The judgment does not affect Trump’s earlier tariffs on imports from China imposed during his first term, or the various sector-specific duties already in place or planned—such as those on steel. These were enacted using a different legal basis, which the administration may now rely on more heavily to continue its trade strategy, Bloomberg reported.


It is currently unclear how swiftly Wednesday’s ruling will take effect. The court has given the government up to 10 days to complete the administrative procedures needed to withdraw the tariffs. If the decision is upheld, it would, in just a matter of days, cancel newly announced 30% US tariffs on imports from China, 25% tariffs on goods from Canada and Mexico, and 10% duties on most other goods entering the country.

Following the court’s decision, Trump responded on Truth Social by posting a picture of himself with the caption: “He’s on a mission from God & nothing can stop what is Coming.”

Goldman says impact could be temporary

“This ruling represents a setback for the administration’s tariff plans and increases uncertainty but might not change the final outcome for most major US trading partners,” said Alec Phillips, chief US political economist at Goldman Sachs. “For now, we expect the Trump administration will find other ways to impose tariffs.”

The Manhattan-based trade court sided with a coalition of small businesses and Democratic-led states. It ruled on Wednesday that US President Trump had misused an emergency law to impose sweeping tariffs on global trading partners. A three-judge panel ordered the government to stop collecting tariffs within 10 days—a decision the White House has already challenged in a higher court.

Also Read: Trump had used a 1977 emergency law to spook the world

In a blow to a cornerstone of Trump’s economic platform, the Court of International Trade declared that the emergency law cited by the White House does not grant the president unilateral authority to apply tariffs on nearly all nations.

Trump had announced the new tariffs in April, describing the US trade deficit as a national emergency. His plan included a 10% tax on all imports, with even higher rates targeting countries like China that maintain trade surpluses with the US.

Many of these proposed tariffs were paused within a week. On 12 May, the White House declared it would scale back the most severe tariffs on China while working towards a new trade deal. The US and China agreed to temporarily reduce tariffs on each other for a period of at least 90 days.

The possibility of eliminating these tariffs—even for a short period—has been seen as a potential boost for global and US economic growth. Many central banks have pointed to the uncertainty created by trade disputes as a hindrance to economic activity.

Legal fight escalates, Supreme Court could weigh in

In reaction to the ruling, Blomberg said a White House spokesman dismissed the decision as one taken by “unelected judges” who should not determine the appropriate response to a national emergency. Trump has previously declared various national emergencies—from the trade deficit to overdose deaths—as justification for his tariff strategy.

The ruling can still be appealed and may ultimately be considered by the US Supreme Court.

Meanwhile, Trump still has several tools at his disposal to continue levying tariffs. He could invoke Section 122 of the Trade Act, which permits tariffs of up to 15% for 150 days. Alternatively, he could initiate investigations under Section 301, although these would take longer to implement.

According to Goldman Sachs’ Phillips, the court’s ruling is unlikely to have a major impact on the fiscal package being debated in Congress. “Tariff revenue was never counted toward offsetting the cost of the package, and most lawmakers never made a clear link between the two issues,” he said.

Nevertheless, the tariffs struck down by the court were projected to generate nearly $200 billion annually—roughly the same amount by which the fiscal package would increase the deficit next year, and more than the impact in subsequent years. “For now, we expect the Trump administration will find other ways to impose tariffs, so we still expect most of this revenue to materialize,” Phillips said.

India and UK may look at re-evaluating deals after ruling

Major trading partners including China, the European Union, India, and Japan—who are currently in trade talks with the Trump administration—may now assess whether to continue negotiations or slow them down, betting that the ruling gives them greater leverage.

In India’s case, the Global Trade Research Initiative (GTRI) responded to the developments by urging caution. The organisation warned against entering trade agreements under what it called “unlawful” pressure tactics. Ajay Srivastava, founder of GTRI, said that the tariffs imposed under Trump had breached both World Trade Organisation (WTO) rules and US domestic law, as confirmed by the court.

“With Trump’s tariff strategy now on shaky legal ground, India must pause and rethink its negotiation approach before signing an FTA that could unfairly benefit the US,” Srivastava said.

The court’s decision has also cast doubt on a potential trade deal between the US and the UK. Earlier in May, Trump had reached a preliminary agreement with the UK which included a provision for a 10% US tariff on all imports from Britain. That deal would be void if Wednesday’s court ruling stands.

“I don’t know why any country would want to engage in negotiations to get out of tariffs that have now been declared illegal,” Jennifer Hillman, a professor at Georgetown Law School, former WTO judge, and former general counsel for the US Trade Representative, told Bloomberg. “It’s a very definitive decision that the reciprocal worldwide tariffs are simply illegal.”

Hillman added that the court had also ruled out the use of tariffs as a bargaining chip in trade talks. “What the court is saying is creating leverage is not a legitimate use of tariffs,” she said. “To me it’s a very, very important decision.”

Hillman and other legal experts acknowledged that Trump could still use other legal frameworks to impose duties. However, none would provide the sweeping authority he claimed under the International Emergency Economic Powers Act (IEEPA), which the court has now rejected.

One possible tool is a 1974 provision that permits presidents to impose up to 15% tariffs for 150 days during a balance of payments crisis. But according to Hillman, Trump may hesitate to invoke this route given the fragile state of the bond markets.

Alternatively, he could continue targeting specific sectors or countries using national security provisions. In his first term, Trump used these powers to impose tariffs on imported steel, aluminium, and cars, and he has recently opened seven new investigations concerning products such as pharmaceuticals, lumber, and critical minerals.