(PYMNTS)—The Trump administration’s justification for its tariffs is being challenged by a lawsuit filed in the U.S. Court of International Trade on behalf of five small businesses.
The Liberty Justice Center said in a Monday (April 14) press release that it filed the suit arguing that the administration has no authority to issue the tariffs without congressional approval.
The suit challenges the president’s invocation of the International Emergency Economic Powers Act (IEEPA) to justify the tariffs, according to the release.
“The lawsuit argues that the Administration’s justification — a trade deficit in goods — is neither an emergency nor an unusual or extraordinary threat,” the release said. “Trade deficits have existed for decades, and do not constitute a national emergency or threat to security. Moreover, the Administration imposed tariffs even on countries with which the U.S. does not have a trade deficit, further undermining the Administration’s justification.”
On its website, the organization describes itself as a nonprofit, nonpartisan, public-interest litigation firm dedicated to protecting economic liberty, private property rights, free speech and other rights.
It filed the suit on behalf of liquor importer and distributor VOS Selections, sportsfishing tackle business FishUSA, ABS pipe manufacturer Genova Pipe, educational electronic kit and musical instrument manufacturer MicroKits LLC and women’s cycling apparel brand Terry Precision Cycling, according to the release.
Each business reports being harmed by the tariffs, per the release.
“No one person should have the power to impose taxes that have such vast global economic consequences,” Liberty Justice Center Senior Counsel Jeffrey Schwab said in the release. “The Constitution gives the power to set tax rates — including tariffs — to Congress, not the President.”
When President Donald Trump announced the imposition of tariffs on imports from Canada, Mexico and China on Feb. 1, he cited IEEPA.
The White House said in a fact sheet that the orders imposing the tariffs came in response to an “extraordinary threat” posed by illegal immigration and the flow of drugs like fentanyl.
“The orders make clear that the flow of contraband drugs like fentanyl to the United States, through illicit distribution networks, has created a national emergency, including a public health crisis,” the fact sheet said.