NAMM Welcomes Supreme Court’s Ruling Invalidating IEEPA Tariff Authority, MI Industry Responds O n Feb. 20, the U.S. Supreme Court issued a landmark 6–3 decision in Learning
and sales strategies in response to what has now been judged an illegal action. Those costs remain, not to mention the cost of the actual tariffs already paid. The administration retains other statutory avenues to impose import taxes or trade restrictions, with costs that ultimately reach U.S. businesses and consumers.” Goldenson acknowledged the difficulties the constantly changing tariff landscape has caused businesses. “It’s this continued uncertainty that challenges short- and long-term planning across our industry,” Goldenson said. “Like many sectors of the economy, we must continue to navigate volatility with resil- ience, discipline and strategic adaptability. We must navigate the chaos.” Taylor Harnois, general manager of MI POS and business platform Music Shop 360, suggested music retailers consider a few courses of action to mitigate their risk. “First, don’t bank on seeing any type of tariff refund for the foreseeable future,” Harnois advised. “Yes, you should have documentation ready to go to petition for refunds if and when the opportunity arises, but certainly don’t make any as- sumptions that include the receipt of any tariff refunds. For the time being, consider those as sunk costs and plan accordingly for your business. Secondly, do your best to preserve or increase your margins on your buys. If an international manufacturer offers any promotional discounting, try to take advantage. Preserving margin on the front end will help you stay competitive on the back end. Third, cash flow discipline isn’t optional anymore. Keep more cash on hand to cover unexpected cost increases. Tariff policy volatility means higher risk, so making big inventory bets now is a bit of double jeopardy.” Finally, Harnois reminded retailers that pricing wars don’t benefit anyone. “Instead of racing to the bottom, try providing added value to your customer base, offering a free lesson, extended war- ranties, or perhaps some new financing options,” he said. “It might also be helpful to focus your promotions and discounts on non-tariff-exposed goods and services like work orders, accessories made domesti- cally or music education.” Music Inc. will continue to update this story as it evolves. {namm.org}
Resources, Inc. v. Trump, ruling that the In- ternational Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs. The Court held that the power to “regulate importation” under IEEPA does not — and never did — include the power to impose tariffs, which are a distinct form of taxation explicitly reserved to Congress under Article I of the Constitution. “Today’s decision provides long-awaited relief and clarity for music products manu- facturers, retailers and distributors who have struggled with unpredictable costs from these tariffs during the past year,” said John Mlync- zak, president and CEO of NAMM. “Using IEEPA to sporadically regulate tariffs has placed an enormous and unjustified burden on our industry. We welcome the Court’s decision restoring the constitutional balance on trade authority.” The ruling invalidates both sets of IEE- PA-based tariffs challenged in the case: the reciprocal tariffs of at least 10% imposed on goods from all U.S. trading partners, and drug trafficking tariffs on Chinese, Canadian and Mexican imports. The ruling doesn’t affect Section 301, Section 232 or potential new Section 122 tariffs. NAMM will continue to monitor all tariff activity and update NAMM members. On the question of refunds, the Court’s ruling is silent on whether — and how — duties already paid will be returned. Shortly after the Court’s decision, Presi- dent Trump announced he would immediately impose a 10% global tariff, and then increase it to a 15% global tariff, under Section 122 of the Trade Act of 1974 to address trade deficits. Treasury Secretary Scott Bessent stated the administration would also expand use of Section 232 (national security) and Sec- tion 301 (unfair trade practices) authorities. These authorities come with constraints the administration didn’t face under IEEPA. For example, Section 122 tariffs are capped at 15% for 150 days unless Congress ap- proves an extension. Section 301 tariffs require a formal investigation by the U.S. Trade Representative. Section 232 actions require a Commerce Department national security determination and are product- specific — the same process that governs existing tariffs on steel, aluminum and musical instrument components like lumber
and copper. When it comes to refunds for IEEPA tariffs already paid, Trump sug- gested the administration doesn’t plan to proactively return duties collected. Almost immediately, experts began an- ticipating more uncertainty unraveling from the news. Patrick Penfield, profes- sor of supply chain practice at Syracuse University, said he believes businesses should begin reviewing what international purchases they’ve made since April 1, 2025, to figure out how much is owed to them. “The Supreme Court ruling that invalidated President Trump’s tariffs will cause chaos within the supply chain,” Penfield surmised. “Consumers can expect delays for incoming products from other countries, especially with border agents trying to determine what tar- iffs to charge and what products should not be charged. This review may cause backups at ports and border crossings for the next few weeks. Companies should also start to review what international purchases they have made from April 1, 2025, to Feb. 20, 2026, and then determine how much is owed to them by the additional tariffs enacted by President Trump.” On the MI manufacturing side, Jerry Gold- enson, president of KHS America, which has multiple brands under its umbrella that manufacture instruments in China and Tai- wan, weighed in with his thoughts. “The recent Supreme Court ruling repre- sents an important victory, but not because it immediately eliminated the IEEPA tariffs, but because it reaffirms a fundamental prin- ciple that the rule of law matters,” Gold- enson said. “In today’s uncertain climate, that affirmation carries significant weight. Although the tariffs were deemed unlaw- ful, the financial impact already absorbed by businesses is unlikely to be recovered. Companies adjusted pricing, supply chains
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