It’s official: Trump’s surprise toy tax has been ruled illegal.
In a major decision that sent shockwaves through manufacturing and retail, the U.S. Court of International Trade struck down President Donald Trump’s “Liberation Day” tariffs, declaring that he exceeded his authority under the International Emergency Economic Powers Act (IEEPA). Translation? The executive branch can’t unilaterally drop massive import taxes without Congress stepping in.
The ruling permanently blocks the steep, multi-layered tariffs — some climbing as high as 145% — that blindsided the toy industry earlier this year. While the current rate sits at 30% for imports from China (10% + the 20% fentanyl tax), and a baseline 10% duty on imports from most other countries (with some exceptions), the legal win paves the way for some much-needed clarity and stability for manufacturers, distributors, and retailers navigating a turbulent 2025.
Industry leaders and small business coalitions argued that the tariffs were both unconstitutional and economically devastating. On Wednesday, following numerous lawsuits challenging the tariffs, the court agreed.
For toy and game makers, especially those relying on imports from China, the decision opens the door to re-stabilizing pricing, production timelines, and retailer planning heading into the second half. Some immediate questions include the timing of a reset to the previous tariff rates and potential reimbursement for tariffs paid prior to the ruling.
Of course, nothing’s settled yet — Trump’s camp already filed a notice of appeal. But for tonight, it’s a win. And while the world awaits the inevitable tweet/truth from the President, White House Deputy Chief of Staff Stephen Miller already fired off a tweet stating that “The judicial coup is out of control.”
If you’ve hung on with this nonsense until now, keep the band together, because this tour’s far from over. The toys are still coming, but the trade war is just getting started.
This is a breaking news story and may be updated…
