By Tim Gocklin, MBA, MSF (Editor-in-Chief)
What Tariffs Even Are (Super Basics)
Tariffs are essentially taxes that the United States government levies on goods entering the United States from other nations.
If a Chinese company wants to export widgets into the United States, the United States can choose to tax those widgets as they enter the United States.
The amount of the tariff that the United States levies depends on the value of the goods that are being imported (15 percent tariff on $100 of goods equals $15).
Who pays the tariffs? In most cases, the company that is bringing the goods into the United States pays the tariffs.
Tariffs are essentially taxes that the United States levies on goods entering the United States from other nations.
Trump’s Tariff Policy: What Happened
President Trump, during his term in office, especially between 2025 and 2026, wanted to impose tariffs that were much higher than usual.
Some of the tariffs that Trump wanted to impose are:
A Huge Global Tariff
In April 2025, Trump wanted to impose a 10 percent tariff on all goods entering the United States, commonly referred to as Liberation Day tariffs.
Large Country Specific Tariffs
Trump also wanted to impose large tariffs on specific nations.
China had tariffs much higher than 10 percent.
Canada and Mexico had tariffs due to the US Mexico Canada trade debate.
Brazil and India had tariffs up to 50 percent.
How Tariffs Affect American Companies
Imports
American companies, which depended on foreign components or products, paid more to bring those components or products into the country because of the tariffs.
For instance, a company importing components from China has to pay tariff tax, which increases the cost.
Most of the companies that were affected either had to adjust their production, delay their expansions, or increase the prices of their products in the United States.
Who Foots the Bill
American companies pay the tariff tax to Customs and Border Protection.
Most of the companies passed on the increased cost to the consumers.
Small and medium sized companies were also affected, especially because of their lower profit margin.
Exports and Retaliation
Other countries also increased their tariffs on American exports, making it harder for American exports to compete globally.
For instance, the EU has threatened to impose billions of dollars worth of tariffs on exports to the United States.
So, American companies that both export and import have experienced the ripple effects of the tariffs.
Impact on Other Countries
Tariffs do not only affect the import of goods into the country. It also has a ripple effect globally.
Other Countries
Brazil, India, Canada, Mexico, the EU, and many other countries saw their exports to the United States become more expensive and less competitive.
Most of the countries also imposed retaliatory tariffs on exports going to the United States, affecting American exporters.
Global Trade Relations
The negotiations between countries also slowed down.
Countries even began thinking of renegotiating their trade agreements.
So, it is apparent that international companies that export their products to the United States are now facing increased costs and even retaliatory tariffs on exports going to the United States.
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The Recent Supreme Court Case
In February 2026, the U.S. Supreme Court decided an important case about Trump’s tariff powers.
What the Supreme Court Decided
In a 6 to 3 decision, the Court held that Trump did not have the legal power to impose the tariffs across the globe under the law he used, the International Emergency Economic Powers Act.
In simple terms, the Supreme Court held that only Congress has the power to impose taxes in the form of tariffs, except in those cases where Congress specifically gives that power to the President, which it did not do in this case.
Why It Matters
This decision means that the legal basis for Trump’s tariffs was invalid.
Trump’s tariffs imposed under the law in question may be unlawful and subject to refund.
What Happens to the Tariffs Already Paid
Businesses and organizations are seeking refunds of the tariffs already paid. In total, perhaps $133 to $175 billion of the tariffs already paid could be subject to refund.
However, the Supreme Court has not ordered these refunds, and that issue must be decided in the lower courts, which may take years.
This decision not only involves the issue of legal authority but also the possible impact of the tariffs already paid.
Trump’s Reaction and the Next Steps
Rather than removing the tariffs, Trump took the following steps.
15 Percent Temporary Global Tariff
Trump imposed a 15 percent tariff on the globe under a different law, Section 122 of the Trade Act. This law allows for tariffs of up to 150 days for balance of payments problems.
Experts say that the administration could also use other trade laws such as Section 232 and Section 301 to impose tariffs that can withstand a court battle.
In other words, tariffs have not gone away. They have simply been reorganized under a different tool.
Big Picture: What This Means for You and the Economy
For American Consumers
More costs on imported goods at least until the law and policy changes are implemented.
Lowered costs as companies get a refund and pass it on.
For American Businesses
More uncertainty as businesses have to plan under a changing policy.
Refunds are a possibility but only after a long time and a long court battle.
Supply chains could reevaluate their sourcing strategies as a result.
For Other Countries
Trade talks are also uncertain.
Some countries could reduce their tariffs as a result.
Others could keep retaliatory tariffs.
Summary in Plain English
Tariffs are taxes on goods that come into the United States.
President Trump has slapped very broad tariffs on many different countries as a way to protect American businesses and solve trade deficits.
The tariffs have had a big impact on businesses and consumers within the United States.
They have also led many other countries to retaliate with their own tariffs.
The Supreme Court has now ruled that Trump’s ability to impose tariffs under an emergency law has been unconstitutional.
The law can only be made by Congress.
Businesses are now demanding huge refunds.
But that could take a long time.
President Trump immediately announced a new 15 percent tariff under a different law.
If you want, paste your source links here and I will format them cleanly at the bottom for WordPress.
Sources
https://en.wikipedia.org/wiki/Learning_Resources%2C_Inc._v._Trump
https://www.reuters.com/legal/government/us-supreme-court-rejects-trumps-global-tariffs-2026-02-20
https://www.cfr.org/articles/how-trumps-tariffs-could-survive-the-supreme-court-ruling
https://www.theguardian.com/us-news/2026/feb/21/trump-tariffs-15-percent