Relevance: GS II (International Relations) & GS III (Economy) | Source: The Hindu / Indian Express

1. The Big News: A Check on Power

In February 2026, the US Supreme Court gave a historic decision (in a 6-3 vote) against the US President.

• The Ruling: The Court clearly said that the President cannot use “emergency powers” to put heavy taxes on goods coming from other countries.
• The Core Rule: Under the US Constitution, the power to collect taxes belongs only to their Parliament (called the Congress), not to the President.

2. Why This is Good for India

India was one of the main targets of these heavy, one-sided taxes.

• Cheaper Indian Goods: With these taxes gone, Indian products like clothes, steel, and car parts will become cheaper to sell in the US market. Around 55% of India’s exports will benefit from this.
• No More “Tit-for-Tat”: The US President had previously taxed Indian goods simply because India taxes US-made items (like Harley-Davidson bikes). The Court’s ruling stops this specific retaliatory tax.
• The Money Back: The US government has already collected over $130 billion through these illegal taxes. Now, massive companies are preparing to fight to get their money refunded.

3. The Tariff War Continues

Even though the Court said “No”, the global trade war is not over.

• The New Tax: Just hours after the court decision, the US President found another old law. He has now ordered a new, temporary 10% tax on all global goods for the next 150 days.

UPSC Value Box

Key Concept	Explanation
Separation of Powers	A core democratic rule which ensures the President (Executive) cannot steal the law-making and taxing powers of the Parliament (Legislature).
Protectionism	When a country puts very high taxes on foreign goods to stop them from entering, just to protect its own local businesses.
Section 122	A specific US law that allows the President to put temporary import taxes (for a maximum of 150 days) during emergencies.

Q. With reference to international trade and the recent US Supreme Court ruling on import taxes, consider the following statements:

1. Under the United States Constitution, the power to impose taxes and tariffs belongs exclusively to the President.
2. “Protectionism” refers to the practice of a country imposing high taxes on foreign goods to protect its own domestic industries.
3. The recent US Supreme Court ruling allows the President to impose permanent global taxes without Congressional approval.

Which of the statements given above is/are correct?

(a) 1 and 2 only

(b) 2 only

(c) 1 and 3 only

(d) 1, 2 and 3

Correct Answer: (b)