On February 20, 2026, the Supreme Court ruled 6-3 that Trump's IEEPA tariffs were illegal. Four days later, the administration invoked Section 122 of the Trade Act of 1974 — a 50-year-old statute designed for gold-standard-era balance-of-payments crises that had never been used before. It imposed a 10% surcharge on most imports, later raised to 15%, the statutory maximum. Under the statute, that authority expires at 12:01 a.m. EDT on Friday, July 24. No extension bill is moving in Congress. The U.S. Trade Representative (USTR) has a parallel deadline — this Monday, July 20 — to finish two Section 301 investigations covering 60+ countries, with proposed 12.5% replacement duties that would have no rate cap and no expiration date.

1. The Administration's Move (USTR Ambassador Jamieson Greer, Treasury Secretary Scott Bessent)

The tariffs aren't expiring — the administration is replacing them with something permanent.

The replacement is already in motion. USTR Ambassador Jamieson Greer and Treasury Secretary Scott Bessent put Section 301 investigations on an "accelerated timeline" specifically to finish before July 24. Monday is the deadline. Proposed rates: 12.5% on 46 countries, including China, Japan, India, Vietnam, and South Korea.

The rates are coming back to pre-SCOTUS levels. Bessent said so publicly in April and has repeated it since, predicting the return by early July. The administration has no intention of offering importers a break.

Section 301 gives the administration more room. Unlike Section 122 — capped at 15% and limited to 150 days — Section 301 has no rate ceiling and no sunset. Existing Section 301 duties on some products already run as high as 100%. The new investigations open the door to rates above Section 122's cap, country by country, with no statutory limit.

2. Repeal It Entirely (Sen. Tim Kaine, Sen. Raphael Warnock, Sen. Rand Paul)

Congress should take trade authority back — it wrote Section 122 for a crisis that ended decades ago.

There's a Senate bill to repeal Section 122 entirely. Sen. Tim Kaine (D-VA) and Sen. Raphael Warnock (D-GA) introduced the Reclaim Trade Powers Act, with ten co-sponsors including Sen. Ron Wyden (D-OR), Sen. Amy Klobuchar (D-MN), and Sen. Patty Murray (D-WA). Separately, Sen. Rand Paul (R-KY) joined Senate Minority Leader Chuck Schumer (D-NY), Kaine, and Wyden on a bipartisan bill to repeal global tariffs and restore congressional trade authority.

Congress wrote Section 122 in 1974 to guard U.S. gold reserves. Kaine argues that invoking it now — for the first time in 50 years — as broad trade policy is an abuse of emergency authority. The Section 301 replacement, these critics say, is an even bigger end-run around Congress, with no time limit and no rate ceiling.

3. Just Let the Tariffs Expire (Retail Industry Leaders Association, Burlap and Barrel, 24 State AGs)

The tariffs have done real damage. A genuine holiday would help — but the Section 301 replacement may be worse.

The surcharge has already hurt. The Retail Industry Leaders Association warned that "each new action creates additional uncertainty for retailers making sourcing, pricing, inventory, and supply chain decisions months in advance." Small-business bankruptcies jumped 67% in Q1 2026 over the prior year.

The courts already ruled the tariffs are illegal. The Court of International Trade found on May 7 that Section 122 exceeded Trump's statutory authority. The court limited relief to the two named importer plaintiffs — a New York spice importer and a Florida toy company. The 24 state AGs lost standing. Customs still collects the tariff nationwide while the appeal proceeds.

The replacement tariffs may be higher and have no end date. If Section 301 kicks in on July 24, rates could exceed Section 122's 15% cap with no expiration. The effective tariff rate would fall from 11% to 8.2% if Section 122 lapses with no replacement. The administration has made clear that is not the plan.

Where This Lands

The USTR's deadline is Monday. If USTR announces Section 301 duties before Friday, the tariff clock on most imports never resets to zero. If it doesn't, importers face a brief window at lower rates before replacement duties arrive in August. The Kaine-Warnock coalition has no path to a Senate vote; their bill signals opposition but will not move. Importers who want relief are betting on the gap between Friday's expiration and whenever Section 301 orders take effect. The administration is trying to close that gap entirely.

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