A coalition of 24 Democratic state attorneys general and governors filed a lawsuit Thursday asking the U.S. Court of International Trade to block implementation of President Donald Trump’s new global 10 percent tariff on the grounds that it is unconstitutional and violates the law.
“Once again, President Trump is ignoring the law and the Constitution to effectively raise taxes on consumers and small businesses,” New York Attorney General Letitia James said in a statement. “After the Supreme Court rejected his first attempt to impose sweeping tariffs, the president is causing more economic chaos and expecting Americans to foot the bill.”
The states are asking the CIT to declare the new tariffs illegal and prevent them from being implemented. They also want the federal government to refund states the cost of the new tariffs while they were in effect.
The move follows the Supreme Court’s decision Feb. 20 that Trump exceeded his authority under the 1977 International Emergency Economic Powers Act to impose tariffs last year on virtually every country in the world.
Trump responded by replacing those tariffs, which ranged from 10 to 50 percent depending on the country, with a new 10 percent tariff for 150 days, relying on a never-before-used law known as Section 122 of the 1974 Trade Act.
That statute allows the president to impose a surcharge as high as 15 percent on imports for up to 150 days to address a “large and serious” balance of payments deficit.
In a statement describing the lawsuit, James’ office argued that “balance of payment problems no longer occur” in the U.S. because they happen only under a fixed-rate exchange system like the gold standard, which the U.S. government abandoned in the early 1970s.
The fact that the U.S. runs a large trade deficit “Is not a legitimate reason for imposing tariffs under Section 122,” the New York statement said. “In fact, the administration admitted during the prior lawsuit against the president’s IEEPA tariffs that trade deficits ‘are conceptually distinct from balance of payments deficits.’”
The states also argue that Trump’s tariffs fail to fit the criteria under Section 122, which they said requires new tariffs to be applied consistently in several ways, including that they are not applied in a discriminatory fashion.
“Yet the new tariffs exempt many goods from Canada, Mexico, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua. They also include 84 pages of specific product exemptions,” the New York statement said.
Oregon Attorney General Dan Rayfield, Arizona Attorney General Kris Mayes and California Attorney General Rob Bonta are leading the case, long with James. Also joining the lawsuit are the attorneys general of Colorado, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Rhode Island, Vermont, Virginia, Washington, Wisconsin, and the governors of Kentucky and Pennsylvania.
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