WASHINGTON (TNND) — President Donald Trump said during his State of the Union address that his administration will keep tariffs in place by relying on alternative legal statutes after the Supreme Court rejected part of his tariff program last week, and he again argued that tariff revenue could eventually replace federal income taxes.
Legal experts noted that the statute the administration is using, Section 122, is only a temporary solution. (TNND)
Trump said the tariffs “will remain in place until fully approved and tested alternative legal statutes,” adding, “They have been tested for a long time. They’re a little more complex, but they’re actually probably better.”
Legal experts noted that the statute the administration is using, Section 122, is only a temporary solution. The biggest issue, they said, is that the tariffs can last only 150 days under that authority, and Congress has “made it pretty clear that they’re not renewing after 150 days.” Experts said that unless the president can renew the tariffs on his own after 150 days, he would need to use another legal option.
U.S. Trade Representative Jamison Greer said the administration plans to keep its trade approach in place by shifting to other authorities. “The trade policy we’ve had for the past year is going to remain the same,” Greer said. “The Supreme Court came down and they said that there’s one element of the president’s tariff program where he couldn’t use that particular legal authority. Congress has given several other legal authorities. And so we’re just going to use those instead.”
Trump also repeated his claim that tariffs could eventually replace income taxes. “I believe the tariffs paid for by foreign countries will, like in the past, substantially replace the modern-day system of income tax, taking a great financial burden off the people that I love,” he said.
Income taxes are the federal government’s primary source of revenue, generating around $2.6 trillion annually. Experts said tariffs would not bring in enough money to replace that revenue. Trade expert Kimberly Clawson of the Peterson Institute for International Economics said, “This is not within the realm of possibility.” She added, “We calculate that the revenue-maximizing tariff would raise less than one fifth what the personal income tax raises.”
Meanwhile, the White House said the United States and Canada are expected to meet in the coming weeks to negotiate a renewal of the Canada-U.S.-Mexico trade agreement.
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