Despite the U.S. Supreme Court striking down tariffs imposed under the International Emergency Economic Powers Act, ruling that the authority to implement tariffs under that measure rests with Congress, President Donald Trump remains persistent.
The Trump administration has confirmed that tariff policy will continue by using alternate statutory tools, primarily Sections 122 and 301.
- Section 122 allows up to 10% tariffs, which go into effect at midnight EST tonight, for approximately 150 days. This time-limited authority creates a defined planning window for importers of branded merchandise.
- Section 122 tariffs can only be extended by an act of Congress, making tariff policy a likely legislative issue this summer.
- The administration extended the suspension of duty free de minimis treatment, which may increase costs for low value and direct shipment merchandise.
- The 15% global tariffs that Trump announced over the weekend have yet to be implemented.
- The Trump administration also plans to use Section 301 investigations to sustain tariffs long term. These processes require hearings and public comment and can take up to a year, creating a formal opportunity for industry engagement.
“The Trump administration is committed to continue implementing the president’s trade policy, which was at the core of his campaign and agenda,” says U.S. Trade Representative Jamieson Greer. “For many months, the Trump administration has cautioned foreign trading partners and the business community that if the Supreme Court were to limit the president’s authority to impose tariffs under IEEPA, alternative tools would be implemented to address many of the issues at the heart of the president’s reciprocal tariff program.
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“These objectives include reducing the U.S. global trade deficit in goods, reversing the lack of reciprocity by our foreign trading partners and incentivizing the reshoring of production to the United States. Our partners have been responsive and engaged in good-faith negotiations and agreements despite the pending litigation, and we are confident that all trade agreements negotiated by President Trump will remain in effect.”
What Does This Mean For Branded Merch?
Companies in the branded merch industry should expect continued pricing and sourcing volatility through at least 2026.
Global trade partners, including the EU, India and South Korea, are assessing impacts. The EU is seeking clarity and adherence to existing agreements and has signaled it may respond if terms are undermined. India has paused meetings and is reviewing implications.
Meanwhile, refunds for previously collected tariffs remain legally unresolved and are unlikely to be immediate.
Alok Bhat
Market Economist, PPAI’s Research & Public Affairs Lead
“Markets are reacting more to policy uncertainty than tariff level alone, reinforcing the need for stability in planning and supply chains,” says Alok Bhat, market economist and PPAI’s research and public affairs lead. “Some firms may frontload imports and adjust short term inventory in response to the temporary 15% structure. This reinforces our 2026 outlook: tariff volatility remains the primary planning risk for the industry.”
For the branded merch channel:
- Supplier margin pressure and import timing risk continue.
- Distributor quoting and pricing stability remain challenging.
- Diversified sourcing becomes increasingly important.
PPAI will continue to advocate for predictable and balanced trade frameworks that support U.S. decoration, logistics and distribution jobs, Bhat says. After all, policy stability remains the core business priority for our industry.
“In coordination with our lobbying partner, Thorn Run Partners, we are reinforcing Capitol Hill messaging that trade predictability protects American jobs across decoration, logistics and distribution,” Bhat says, “and we are closely monitoring any congressional action related to tariff authority.”
