Trump’s tariffs get knocked out — but the hit to small business is just beginning

MarketWatch

by Robert Pozen

February 20, 2026

AI-Generated Deep Dive Summary

The U.S. Supreme Court has invalidated President Donald Trump’s 2025 tariffs, which were imposed under the International Emergency Economic Powers Act (IEEPA). The justices ruled that the act, which does not explicitly mention tariffs or taxes, does not authorize broad import duties. This decision underscores constitutional limits on executive authority and raises questions about the legality of similar future actions. However, while the court’s ruling addresses the legal basis for the tariffs, it leaves unresolved the ongoing challenges faced by small businesses, particularly those in manufacturing and retail sectors, which have been hit hardest by the trade measures. The tariffs, implemented in 2025, were part of Trump’s broader strategy to protect U.S. industries and reduce foreign competition. However, they led to significant financial strain on small businesses, as increased import costs inflated expenses for materials, goods, and supplies. Many business owners reported difficulty passing these costs onto customers without damaging profit margins or cutting jobs. The court’s decision, while a blow to Trump’s trade policies, does little to alleviate the immediate economic压力 faced by small businesses. The ruling also raises broader questions about the future of U.S. trade policy. With the tariffs invalidated, Congress will need to address the gap left by the Supreme Court’s decision. lawmakers are already signaling that any new measures must adhere to constitutional and legal constraints, which could limit the government’s ability to impose sweeping trade restrictions in the future. For now, small businesses remain caught between rising costs, uncertain market conditions, and the slow process of adapting to a shifting regulatory landscape. This situation highlights the delicate balance between protecting domestic industries and ensuring fair treatment for all businesses under the law. While the Supreme Court’s decision is

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Originally published on MarketWatch on 2/20/2026