US Economy Poised for Neutral to Positive Impact Following Supreme Court Tariff Decision

The recent US Supreme Court decision to strike down Trump-era tariffs is expected to have a neutral to positive impact on the US economy. According to the Budget Lab, removing the IEEPA “reciprocal” tariffs would generate a fiscal refund, neutralizing the modest 0.1-0.2% GDP drag from the remaining Section 122 duties. Consumer prices would fall back by roughly 0.5%, improving household real income by about $800-$1,000 per family.

In the medium term, the economy would regain the ≈0.5% (≈$110 billion) of GDP lost to the combined Section 232 and IEEPA tariffs, and export volumes would rebound, adding roughly 0.2% to GDP. The net effect is a +0.3% to +0.5% increase in real GDP relative to a “tariffs-remain” scenario.

In the long term, full removal of the tariff regime restores the baseline growth trajectory. The 6% GDP loss projected by the Penn Wharton Budget Model disappears, and the persistent 0.1% (≈$30 billion) annual shortfall identified by the Budget Lab is eliminated.

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