National Bank of Canada's Ethan Currie highlights that the U.S. Supreme Court’s decision striking down IEEPA‑based tariffs will halve the average effective tariff rate, but they stress the White House still has ample tools to keep tariffs high. They expect renewed use of Section 232 and broader sectoral levies as Washington seeks to preserve fiscal and strategic benefits of elevated tariff income.

IEEPA loss shifts focus to Section 232

"The Supreme Court struck down a series of IEEPA-implemented tariffs on Friday in a highly anticipated ruling. This will effectively cut the U.S. average effective tariff rate (AETR) in half, as most levies currently in effect were implemented through the emergency act."

"With nearly $290bln of tariff revenues collected in 2025, the current administration seems keen to keep tariff rates elevated—if not for the purpose of reshoring production or for the use of geopolitical leverage, the customs duties act as a fiscal buffer—required in part to help offset the high costs of the One Big Beautiful Bill Act."

"While IEEPA tariff implementation may no longer be feasible, the President has multiple avenues to rekindle the tariff rate to current levels (above 10%), if desired. For example, Section 232 allows for uncapped tariffs (on both the rate applied and the duration they are able to be applied for), and is the other primary mechanism for which the President has implemented tariffs through."

"These sectoral tariffs are likely to be reintroduced for other product groupings (in addition to those in place on metal products, autos, lumber, etc.), as the White House is currently conducting a series of trade reviews, similar to the process that was undertaken ahead of ‘Liberation Day’."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)