Treating a tax or tariff as different from a confiscation is an interpretive issue that should be decided by Congress, not the judiciary.
On Nov. 5, the Supreme Court will hear arguments in Learning Resources, Inc. v. Trump, a challenge to Trump’s tariffs. The case centers on the validity of the tariffs as an exercise of an executive authority bestowed by the International Emergency Economic Powers Act (IEEPA)—and its outcome concerns business lawyers, not just experts in the constitutional separation of powers. Jack Goldsmith and Bob Bauer have considered how the Court might resolve the issues in light of its general approach to statutory interpretation. My contribution, at best incremental to theirs, will focus on the specifics of federal sanctions law.
My point here is that a state taking somebody’s money is different from barring them from using their property. A monetary charge is conclusive and compels the surrender of ownership. An indefinite ban on benefiting from ownership produces real pain, but it does not irrevocably sever the tie between an owner and its property. This distinction mattered to Congress when it adopted IEEPA, the statute at the heart of this case. Two very limited exceptions aside, IEEPA does not authorize confiscations of alien property. That Congress added limited exceptions through the 2001 Patriot Act and 2024 REPO Act confirms that IEEPA lacks a general authority to seize, as opposed to freeze, property.
A tariff, like a tax, permanently separates people from their property. Moreover, there is nothing in IEEPA that would distinguish taxation from imposing tariffs. Other than residing in different titles of the federal code, they are the same. The question before the Court in Learning Resources is whether a levy of a tax or tariff is like a confiscation. At a minimum, treating a tax or tariff as different from a confiscation is an important interpretive issue that, under the Court’s current doctrine, should be decided by Congress, not the judiciary.