Webinar recap: IEEPA tariff updates

This webinar was recorded on February 25, 2026.

The Supreme Court ruled President Trump's IEEPA tariffs illegal. What does that mean for your business?

The news cycle around tariffs has been relentless but last week, something significant shifted. Cart.com's Jack Ulrich brought together CEO Omair Tariq and former White House Supply Chain Coordinator Tim Manning to cut through the noise and explain what the Supreme Court's latest ruling actually means for retailers and merchants heading into the rest of 2026.

Here's a breakdown of everything they covered:

The Supreme Court struck down IEEPA Tariffs — Here's what that means

The big news that prompted this webinar: the Supreme Court issued a 6-3 ruling in Learning Resources v. Trump, determining that President Trump did not have the authority to use the International Economic Emergency Powers Act (IEEPA) to impose tariffs.

IEEPA was the legal foundation the administration used to roll out sweeping, rapidly changing tariff rates across dozens of countries . The court's majority found that the law's language around "regulating commerce" did not constitute an explicit grant of tariff authority, with several justices leaning on the "major questions doctrine," which holds that Congress cannot implicitly delegate such significant power to the executive.

As a result, the IEEPA-based tariffs were struck down, and the President issued an executive order rescinding them.

But don't celebrate too fast...new tariffs are already in place

Almost immediately after the ruling, the administration pivoted. The President invoked Section 122 of the Trade Act to establish a new 10% global baseline tariff, with the possibility it could rise to 15%. The legal durability of this move is already being questioned — Section 122 was written to address "large and serious" balance of payments crises, and most economists argue no such crisis currently exists. Expect legal challenges to work through the courts over the next several months.

Additionally, the de minimis exemption (the rule allowing imports under $800 to enter duty-free) remains suspended. Although the Supreme Court's ruling implicitly challenged the administration's authority to eliminate it via IEEPA, the President quickly reinstated the suspension through a separate order, and no court has explicitly struck it down.

What about refunds?

Here's where things get complicated. While the ruling technically means IEEPA tariffs were unlawfully collected, there is no automatic refund process. The Supreme Court provided no formal direction for reimbursement, and the process will now work through lower court, which could potentially take one to three years.

A few important nuances:

• Only the Importer of Record (IOR), the party listed on U.S. Customs entry documents, can directly file for refunds with CBP. If a freight forwarder, distributor or supplier handled your imports, your path to a refund is more complicated.
• If you passed tariff costs on to your customers, there's an open legal question about whether you're still eligible for a refund.
• Tim Manning's advice: preserve all your records now, regardless of where you sit in the supply chain. No official CBP process has been established yet, and when it is, you'll want complete documentation ready.

Section 301, 232 and what comes next

With IEEPA now effectively off the table, the administration is expected to rely on other trade authorities — most notably Section 301 (unfair trade practices) and Section 232 (national security tariffs). These tools require formal investigations and supporting findings, which makes them slower to deploy than IEEPA but carry no statutory cap on tariff rates.

Section 232 investigations are already underway in areas like semiconductors, medical devices and pharmaceuticals. Section 301 could be used more broadly, though tying it to the kinds of foreign policy rationales the administration favored under IEEPA will be legally challenging.

The wildcard: Section 338, a rarely-used authority that hasn't been invoked in over 100 years. It faces many of the same legal vulnerabilities as IEEPA, but don't be surprised to hear it mentioned.

The inflation reality check

Were the 2025 tariffs inflationary? Yes, but with nuance. Omair described it as a one-time pricing adjustment rather than persistent, year-over-year inflation. But it was one that was still very real for consumers and small-to-mid-sized retailers who lacked the negotiating leverage of a Walmart or Costco to push costs back onto manufacturers. Many had no choice but to pass those costs downstream.

Tim added that economic modeling suggests somewhere between 60–96% of tariff costs on durable goods were passed through to consumers. And with defense spending, potential IEEPA refunds re-entering the economy, and continued trade uncertainty, he cautioned that inflationary pressures remain "multifactorial" and difficult to predict over the next several quarters.

What should merchants do right now?

Both Omair and Tim had clear, actionable advice for merchants navigating this environment:

Preserve flexibility above all else. Avoid one-way-door decisions. Don't make permanent pricing changes up or down just yet. Don't overhaul your supply chain in a panic. Keep contracts adjustable. Practice disciplined, data-driven inventory management and overstock only products with proven demand and low price elasticity.

Build scenario-based financial models. If your tariff rate could change three times before year-end, your financial model needs to reflect that. Map out how different tariff scenarios affect your landed cost and cash position. For some businesses, this isn't just a profitability question, it could be an existential one.

Optimize your cost structure now. Regardless of how tariffs shake out, reducing your operating costs is a "no regrets" move. Renegotiate vendor contracts, explore consolidated logistics programs, and find efficiency anywhere you can.

File protective refund claims if you're the IOR. If you were the importer of record for IEEPA-era imports, start the refund process now. Billions of dollars in potential refunds are at stake, and getting your documentation in order early matters.

Monitor sourcing strategy carefully. If your competitors source from countries where tariffs may ease or disappear while yours don't, they could gain a significant cost advantage. Stay agile and watch how the landscape shifts.

Final thought

As Omair put it: the businesses that will survive and thrive in this environment are the ones that preserve optionality and avoid making panic-driven, irreversible decisions. The tariff situation is far from resolved but with the right preparation, retailers can stay ahead of it.

Questions? Our team can help your business overcome international tariff challenges and changes. Get started here.