Congress Takes Aim at Executive Tariff Power

Cato scholars have long argued that Congress needs to limit the tariff powers it has delegated to the executive branch, which has used these expansive grants to tax a growing share of the products Americans purchase abroad. Amid the Trump administration’s continued abuse of these delegated authorities to impose increasingly unpopular tariffs, some members of Congress seem increasingly interested in reasserting some congressional authority over trade policy—even if these efforts do not amount to wholesale reform. 

Lincicome, Packard, and Cato’s Chad Smitson previously wrote on legislation introduced by Sen. Ron Wyden (D‑OR) that would, among other measures, give Congress a central role in approving tariffs proposed by the executive, repeal outdated tariff authorities, and require congressional approval for any trade agreements negotiated by the executive. In recent days, after the Trump administration invoked Section 301 of the Trade Act of 1974 and Section 338 of the Tariff Act of 1930 to impose additional tariffs on 60 countries, other bills with similar but less comprehensive aims have been introduced in both the House and the Senate. These more recent proposals also invalidate the tariffs imposed by the administration under these executive authorities and provide for seamless refunds to importers who have already paid these taxes, thereby addressing other concerns raised previously by Cato scholars. 

On August 27, on the heels of Canada announcing retaliatory duties in response to the administration’s implementation of Section 338 tariffs on $5 billion in Canadian products, Rep. Brad Schneider (D‑IL), together with Sens. Kirsten Gillibrand (D‑NY) and Peter Welch (D‑VT), introduced the Banning Antiquated Duties and Delivering Equitable American Levies (BAD DEAL) Act. The bill repeals Section 338, retroactively invalidates the Trump administration’s tariffs on Canada, and directs the administration to refund importers who have paid any duties levied through this statute. The bill’s scope is limited to Section 338, and it arguably gives the president too much flexibility on tariff refunds (i.e., the bill only directs the president to “take such actions as may be necessary to provide for” refunds). Yet this simplicity also means the bill remains focused on its main objectives: repealing the statute and the tariffs imposed through it and refunding companies that have paid these duties. 

A second bill, introduced by Sen. Chuck Schumer (D‑NY) on September 1, uses a similarly simple formulation but goes further. The End Trump’s Tariff Tax Act not only repeals Section 338 with retroactive effect but also does the same with respect to Section 122 of the Trade Act of 1974. This statute had been invoked by the Trump administration to impose a 10 percent “global” tariff immediately after the Supreme Court overruled the International Emergency Economic Powers Act (IEEPA) tariffs. It also invalidates the 10 to 12.5 percent “forced labor” tariffs imposed by the Trump administration under Section 301, though it does not altogether repeal the statute. Perhaps most notably, the bill mandates refunds of these invalidated tariffs with greater force by directing Customs and Border Protection to issue them automatically (i.e., without requiring importers to explicitly request them) and within 30 days, prioritizing small businesses. Given the shortcomings we have previously identified with the IEEPA tariff refund process, this focus on simplifying and expediting future refunds is welcome. 

To be clear, neither bill addresses every problem that Cato scholars have raised about executive tariff authorities. Unlike Senator Wyden’s Congressional Trade Powers Reform Act of 2026, neither Schumer’s nor Schneider’s bills address Section 201 of the Trade Act of 1974 or Section 232 of the Trade Expansion Act of 1962—even though the latter statute has been increasingly used by the administration to impose “national security” tariffs on everyday items that most Americans would arguably struggle to connect to the nation’s defense imperatives. Although Senator Schumer’s bill repeals the “forced labor” Section 301 tariffs, it makes no mention of other duties currently levied through the statute (e.g., on imports from Brazil), nor does it propose additional guardrails to prevent future abuses. And neither bill addresses the legality of the “reciprocal trade agreements” negotiated by the administration without congressional assent. In sum, Schumer’s and Schneider’s bills send a strong message disapproving of Trump’s more recent tariffs—and acknowledging their harms for import-consuming Americans—but are (at least for now) light on changes to some of the legal mechanisms underpinning the administration’s most expansive tariffs. 

That said, the fact that more legislators are not only speaking up against presidential abuse of tariff authorities but actually introducing bills to limit this abuse and reassert some of Congress’ Article I authority over tariffs and trade is good news in and of itself. Furthermore, that Democrats are behind these bills indicates that tariffs are a political liability—an assessment borne out by polling data—and that the party might even be reconsidering some of its decades-long skepticism toward trade liberalization. Neither of the bills discussed here are likely to garner the veto-proof majority needed to become law, but their proposals should inspire a more ambitious and comprehensive—and, ideally, bipartisan—effort to eliminate costly, unjustified tariffs, compensate Americans who have been harmed by them, and reform the laws that currently give the executive branch outsized discretion over tariff policy.