US Tariff Cut 10% for China! Court Rules Trump's 10% Global Tariff Invalid

Just now,The U.S. Court of International Trade (CIT) ruled that the 10% global tariff (Section 122) implemented by Trump is invalid.

May 7, 2026, Eastern TimeThe U.S. Court of International Trade ruled that the 10% global import tariffs imposed by the Trump administration under Section 122 of the 1974 Trade Act are invalid.。

Screenshot of The New York Times report

Three months ago, on February 20, 2026, the U.S. Supreme Court ruled that Trump's broad "reciprocal tariffs" and "fentanyl tariffs" implemented under the International Emergency Economic Powers Act (IEEPA) were invalid.Trump announced an emergency alternative, declaring a new 10% global tariff under Section 122, which will take effect around February 24, for a maximum period of 150 days, unless Congress extends it.。

On May 7, the U.S. Court of International Trade dealt another blow to Trump's tariff strategy, with a three-judge panel ruling 2-1 that the 10% tariff was unlawful.

The majority opinion held that the trade deficit and other reasons cited by Trump were insufficient to constitute a "large and serious" international payments imbalance emergency required by Section 122, and that the president had overstepped his authority.

The court supported the plaintiff's claims, including those of small businesses such as Burlap & Barrel, Basic Fun, and the state of Washington.Command to refund the paid tariff and add interestand issue a permanent injunction against a specific plaintiff.

The scope of the ruling is narrow, and the court did not comprehensively block the implementation of the tariff; it only prevented the collection of tariffs from the plaintiffs (two private importers and the State of Washington) and ordered the refund of tariffs plus interest to the plaintiffs. However, this means that other companies that have been levied the 122 tariff can also sue to reclaim the tariffs they have paid. If the Trump administration does not appeal, the refund can be executed directly. If it does appeal, it is highly likely that, similar to the reciprocal tariffs, the final outcome will also be a refund. In other words, the 122 tariff is already effectively defunct. Most importantly, the tariffs that have been paid will be refunded.

The Trump administration is expected to immediately appeal to the U.S. Court of Appeals for the Federal Circuit (CAFC). The CAFC is the usual appellate court for CIT tariff cases and typically handles them quickly, potentially on an expedited basis in high-profile trade cases.

Section 122 tariffs themselves last at most 150 days, expiring on July 24, 2026, unless Congress explicitly extends them. Even with an appeal, the tariffs may expire or be replaced by other measures (such as Section 301) before the Supreme Court rules.

🚨 U.S. launches large-scale Section 301 investigation, preparing to replace previous tariffs

The Trump administration has actively initiated and utilized tools such as Section 301 as the primary alternative to IEEPA tariffs, which were ruled invalid by the Supreme Court, and is currently in the investigation and preparation phase for implementation.

In March 2026, the Office of the United States Trade Representative (USTR) launched two major Section 301 investigations covering over 60 key trading partners—including China, the European Union, Mexico, India, Japan, and others—that account for more than 99% of U.S. imports.

A study on "structural excess capacity" practices in the manufacturing sector involving 16 economies. Another study on "failure to effectively prohibit the import of products made with forced labor," covering approximately 60 economies.

The investigation is based on unfair trade practices, "unreasonable or discriminatory" measures, and other grounds consistent with the statutory requirements of Section 301. A hearing has recently been held.USTR plans to expedite the process, aiming to complete and potentially implement new tariffs before Section 122 expires (around July 24).

🚨"Retaliatory Tariffs" and "Fentanyl Tariffs" Refunds to be Received on May 11th

Tariffs imposed by Trump under the International Emergency Economic Powers Act (IEEPA), including "reciprocal tariffs" and "fentanyl tariffs," will be refunded, and the process has already entered the implementation phase. The refunds, including principal plus interest, will be handled by U.S. Customs and Border Protection (CBP).

On April 20, 2026, U.S. Customs officially launched the CAPE refund system, allowing importers or authorized customs brokers to submit refund claims through the ACE portal. This is a dedicated channel for centralized batch processing of IEEPA refunds.

The first refund may be credited around May 11.