Business
World awaits landmark US Supreme Court decision on Trump’s tariffs
Natalie ShermanBusiness reporter
ReutersWhat may be the biggest battle yet in Donald Trump’s trade war is about to begin.
The Trump administration heads to the US Supreme Court on Wednesday, facing off against small businesses and a group of states who contend most of the tariffs it has put in place are illegal and should be struck down.
If the court agrees with them, Trump’s trade strategy would be upended, including the sweeping global tariffs he first announced in April. The government would also likely have to refund some of the billions of dollars it has collected through the tariffs, which are taxes on imports.
The final decision from the justices will come after what could be months of poring over the arguments and discussing the merits of the case. Eventually they will hold a vote.
Trump has described the fight in epic terms, warning a loss would tie his hands in trade negotiations and imperil national security.
On Sunday, the president said he will not attend the hearing in person as he did not want to cause a distraction.
“I wanted to go so badly… I just don’t want to do anything to deflect the importance of that decision,” he said. “It’s not about me, it’s about our country.”
Trump previously said that if he does not win the case the US will be “weakened” and in a “financial mess” for many years to come.
The stakes feel just as high for many businesses in the US and abroad, which have been paying the price while getting whipped about by fast-changing policies.
Trump’s tariffs will cost Learning Resources, a US seller of toys made mostly overseas and one of the businesses suing the government, $14m (£10.66m) this year. That is seven times what it spent on tariffs in 2024, according to CEO Rick Woldenberg.
“They’ve thrown our business into unbelievable disruption,” he said, noting the company has had to shift the manufacturing of hundreds of items since January.
Few businesses, though, are banking on a win at the court.
“We are hopeful that this is going to be ruled illegal but we’re all also trying to prepare that it’s setting in,” said Bill Harris, co-founder of Georgia-based Cooperative Coffees.
His co-op, which imports coffee from more than a dozen countries, has already paid roughly $1.3m in tariffs since April.
A test to Trump’s presidential power
In deciding this case, the Supreme Court will have to take on a broader question: How far does presidential power go?
Legal analysts say it is hard to predict the justices’ answer, but a ruling siding with Trump will give him and future White House occupants greater reach.
Specifically, the case concerns tariffs that the Trump administration imposed using the 1977 International Emergency Economic Powers Act (IEEPA), which the White House has embraced for its speed and flexibility. By declaring an emergency under the law, Trump can issue immediate orders and bypass longer, established processes.
Trump first invoked the law in February to tax goods from China, Mexico and Canada, saying drug trafficking from those countries constituted an emergency.
He deployed it again in April, ordering levies ranging from 10% to 50% on goods from almost every country in the world. This time, he said the US trade deficit – where the US imports more than it exports – posed an “extraordinary and unusual threat”.
Those tariffs took hold in fits and starts this summer while the US pushed countries to strike “deals”.
Opponents say the law authorises the president to regulate trade but never mentions the word “tariffs”, and they contend that only Congress can establish taxes under the US Constitution.
They have also challenged whether the issues cited by the White House, especially the trade deficit, represent emergencies.
Members of Congress from both parties have asserted the Constitution gives them responsibility for creating tariffs, duties and taxes, as well.
More than 200 Democrats in both chambers and one Republican, Senator Lisa Murkowski, filed a brief to the Supreme Court, where they also argued the emergency law did not grant the president power to use tariffs as a tool for gaining leverage in trade talks.
Meanwhile, last week the Senate made a symbolic and bipartisan move to pass three resolutions rejecting Trump’s tariffs, including one to end the national emergency he declared. They are not expected to be approved in the House.
Still, business groups said they hoped the rebuke would send a message to the justices.
‘An energy drain like I’ve never seen’
Three lower courts have ruled against the administration. After the Supreme Court hears arguments on Wednesday it will have until June to issue its decision, although most expect a ruling to come by January.
Whatever it decides has implications for an estimated $90bn worth of import taxes already paid – roughly half the tariff revenue the US collected this year through September, according to Wells Fargo analysts.
Trump officials have warned that sum could swell to $1tn if the court takes until June.
Cafe CampesinoIf the government is forced to issue refunds, Cooperative Coffees will “absolutely” try to recoup its money, said Mr Harris, but that would not make up for all the disruption.
His business has had to take out an extra line of credit, raise prices and find ways to survive with lower profits.
“This is an energy drain like I’ve never seen,” said Mr Harris, who is also chief financial officer of Cafe Campesino, one of the 23 roasteries that own Cooperative Coffees. “It dominates all the conversations and it just kind of sucks the life out of you.”
What could happen next?
The White House says that if it loses, it will impose levies via other means, such as a law allowing the president to put tariffs of up to 15% in place for 150 days.
Even then, businesses would have some relief, since those other means require steps like issuing formal notices, which take time and deliberation, said trade lawyer Ted Murphy of Sidley Austin.
“This is not just about the money,” he said. “The president has announced tariffs on Sunday that go into effect on Wednesday, without advance notice, without any real process.”
“I think that’s the bigger thing for this case for businesses – whether or not that is going to be in our future,” he added.
There is no clear sign of how the court will rule.
In recent years it has struck down major policies, such as Biden-era student loan forgiveness, as White House overreach.
But the nine justices, six of whom were appointed by Republicans, including three by Trump, have shown deference to this president in other recent disputes and historically have given leeway to the White House on questions of national security.
“I really do think arguments are available for the Supreme Court to go in all different directions,” said Greta Peisch, partner at Wiley and former trade lawyer in the Biden administration.
Adam White, senior fellow at the American Enterprise Institute, said he expected the court to strike down the tariffs, but avoid questions like what constitutes a national emergency.
ReutersThe case has already complicated the White House’s trade deals, such as one struck in July with the European Union.
The European Parliament is currently considering ratifying the agreement, which sets US tariffs on European goods at 15% in exchange for promises including allowing in more US agricultural products.
“They’re not going to act on this until they see the outcome of the Supreme Court decision,” said John Clarke, former director for international trade at the European Commission.
Chocolats Camille BlochIn Switzerland, which recently downgraded its outlook for economic growth citing America’s 39% tariff on its goods, chocolatier Daniel Bloch said he’d welcome a ruling against the Trump administration.
His business Chocolats Camille Bloch is absorbing about a third of the cost of new tariffs on kosher chocolate that his firm has exported to the US for decades, aiming to blunt price increases and maintain sales. That decision has wiped out profits for the unit and is not sustainable, he said.
He hopes Trump will reconsider his tariffs altogether, because “that would be easiest”.
“If the court were to make the tariffs go away of course we would see that as a positive sign,” he said. “But we don’t trust that that will bring the solution.”
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In 2025, a sweeping set of reforms by the Pension Fund Regulatory and Development Authority (PFRDA) has been announced to make NPS more attractive, flexible, and investor-friendly.
Non-government subscribers with an NPS corpus of more than Rs 12 lakh can now withdraw up to 80% of their savings as a lump sum, with only 20% mandatorily allocated to an annuity.
The National Pension System (NPS) has been largely used for tax savings. In 2025, a sweeping set of reforms by the Pension Fund Regulatory and Development Authority (PFRDA) has been announced to make NPS more attractive, flexible, and investor-friendly.
Here’s a simple breakdown of what has changed.
Higher lump-sum withdrawals at retirement
One of the most significant changes is the higher cash withdrawal limit. Non-government subscribers with an NPS corpus of more than Rs 12 lakh can now withdraw up to 80% of their savings as a lump sum, with only 20% mandatorily allocated to an annuity. Earlier, 40% had to be annuitised, a provision that often reduced post-retirement returns.
New withdrawal slabs for smaller NPS corpus
PFRDA has introduced a new withdrawal framework based on corpus size, offering greater flexibility to investors with lower balances.
Subscribers with a corpus below Rs 8 lakh can withdraw 100% of the amount as a lump sum. Those with a corpus between Rs 8 lakh and Rs 12 lakh can choose between phased withdrawals using Systematic Unit Redemption (SUR), partial lump-sum withdrawal combined with annuity purchase, or higher lump-sum withdrawal depending on subscriber category.
Systematic Unit Redemption (SUR) introduced
A key structural reform is the introduction of Systematic Unit Redemption, which allows subscribers to withdraw their NPS corpus gradually over a minimum period of six years. This enables a steady post-retirement income stream without locking funds into an annuity.
Investment age limit extended to 85 years
Subscribers can now remain invested in NPS until 85 years of age, up from the earlier limit of 75. This benefits investors who want to delay withdrawals or continue compounding their retirement corpus beyond the traditional retirement age of 60.
More flexibility in partial withdrawals
Before turning 60, NPS subscribers can now make up to four partial withdrawals, compared with three earlier, with a minimum gap of four years. Withdrawals of up to 25% of own contributions are allowed for specified purposes such as education, marriage, home purchase and medical emergencies.
After 60, subscribers who continue investing can make partial withdrawals with a minimum gap of three years between transactions.
Multiple schemes under one NPS account
Non-government subscribers can now hold multiple schemes under a single PRAN, allowing them to diversify across fund managers and investment strategies without opening separate accounts.
100% equity option for long-term investors
From October 2025, private, corporate and self-employed subscribers can invest up to 100% in equities under the Multiple Scheme Framework, up from the earlier cap of 75%. This option is designed for younger investors with long time horizons who can tolerate higher volatility.
Switching between MSF schemes, however, is restricted for the first 15 years or until age 60.
NPS can now invest in gold, REITs and IPOs
NPS equity schemes are now permitted to invest in gold and silver ETFs, REITs, equity AIFs and IPOs. The combined exposure to these assets is capped at 5% of the equity allocation, offering diversification without excessive risk.
Scheme A discontinued: What subscribers must do
Subscribers invested in Scheme A, which focused on alternative assets such as infrastructure, must switch to Scheme C or Scheme E by December 25, 2025. The scheme is being phased out due to low participation and liquidity challenges.
Other investor-friendly changes
Several additional reforms have further improved NPS attractiveness. These include removal of the five-year lock-in for non-government subscribers, permission to pledge NPS corpus to obtain loans (up to 25% of own contributions), and enhanced tax benefits for NPS Vatsalya contributions under Section 80CCD(1B).
Clearer exit and family protection rules
Exit rules have also been streamlined. Subscribers who renounce Indian citizenship can withdraw their entire corpus. In the event of death, nominees or legal heirs receive 100% of the corpus if no annuity has been purchased. Interim relief provisions have also been introduced for cases where a subscriber is legally declared missing.
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December 19, 2025, 16:15 IST
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Business
India’s Net Direct Tax Collection Rises 8% To Rs 17.04 Lakh Crore On Higher Corporate Tax Mop-Up
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Net corporate tax collection during the period (April 1, 2025, to December 17, 2025) stands at about Rs 8.17 lakh crore, up from Rs 7.39 lakh crore in the same period of FY25.
India’s gross direct tax collection, before adjusting refunds, stood at over Rs 20.01 lakh crore so far this fiscal year, a 4.16 per cent growth over the year-ago period.
India’s net direct tax collection has increased 8 per cent to over Rs 17.04 lakh crore in the ongoing financial year so far, on higher corporate tax mop-up. Net corporate tax collection during the period (April 1, 2025, to December 17, 2025) stood at about Rs 8.17 lakh crore, up from Rs 7.39 lakh crore in the same period of FY25.
Refund issuances fell 13.52 per cent to over Rs 2.97 lakh crore between April 1 and December 17.
The country’s non-corporate tax, including individuals and HUFs, mop-up so far this fiscal year stood around Rs 8.46 lakh crore, up from about Rs 7.96 lakh crore in the same period last year.
Securities Transaction Tax (STT) collection stood at Rs 40,194.77 crore so far this fiscal year, marginally higher than Rs 40,114.02 crore in the year-ago period.
India’s gross direct tax collection, before adjusting refunds, stood at over Rs 20.01 lakh crore so far this fiscal year, a 4.16 per cent growth over the year-ago period.
In the current fiscal year, the government has projected its direct tax collection at Rs 25.20 lakh crore, up 12.7 per cent year-on-year. The government aims to collect Rs 78,000 crore from STT in FY26.
Rohinton Sidhwa, partner at Deloitte India, said, “Tax refunds issuance has dropped much below last year, while overall tax collection has grown marginally at 4%. The drop in refunds is being attributed to a higher amount of screening of any fraudulent refund claims. Holding back refunds also accelerates litigation that the tax department can ill afford. Overall, the corporate advance tax increase signals good corporate earnings. Non- corporate advance tax collections have, however, declined possibly on the back of rate cuts for individuals given in the previous Budget.”
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December 19, 2025, 12:49 IST
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Borrowing fell last month to its lowest November level for four years but was still higher than expected as figures for the year so far were pushed higher due to the Government’s U-turn on winter fuel payments.
Official figures showed borrowing stood at £11.7 billion last month, £1.9 billion less than in November last year and the lowest for that month since 2021 thanks to a sharp fall in debt interest payments.
But the figure was more than the £10.3 billion expected by most economists and the £8.6 billion forecast in March by the UK’s independent fiscal watchdog, the Office for Budget Responsibility (OBR).
The OBR’s monthly forecasts from the budget on November 26 are not available until mid-January, according to the ONS.
Borrowing for the eight months of the financial year so far was £132.3 billion, £10 billion higher than the same period a year ago and £16.8 billion higher than the OBR forecast in March.
This was partly due to an extra £1.8 billion of spending on winter fuel payments after the Government U-turned on its previous decision to severely restrict payments through means testing, instead opting to give the payout to all pensioners except those earning above £35,000 a year.
This helped drive an upward revision to borrowing for the seven months to October by £3.9 billion.
ONS senior statistician Tom Davies said: “Despite an increase in spending, this month’s borrowing was the lowest November for four years.
“The main reason for the drop from last year was increased receipts from taxes and National Insurance contributions.”
November’s figure was pushed lower thanks to falling debt interest payments on borrowing, down by £200 million year-on-year to £3.4 billion and the lowest November level for six years.
Public sector net debt, including the Bank of England, reached £2.93 trillion at the end of November, which is around 95.6% of gross domestic product (GDP) and 0.3 percentage points more than a year ago, although remains at levels last seen in the early 1960s.
Elliott Jordan-Doak, senior UK economist at Pantheon Macroeconomics, said there was “very little Christmas cheer for the Chancellor” in the latest borrowing figures.
He added: “Ms Reeves has staked much fiscal credibility on chunky tax increases in the back end of the forecast period. But we think today’s figures further illustrate the shaky foundations of that gamble.
“Revenues continue to underperform, and the smorgasbord approach of tax increases relies on distortionary tax increases with uncertain yields.
“We also have serious doubts about the Government’s ability to follow through on the raft of spending cuts announced in the Budget.”
Chief Secretary to the Treasury James Murray said the debt interest payments underscored the need to bring borrowing down.
He said: “£1 in every £10 we spend goes on debt interest – money that could otherwise be invested in public services.
“That is why last month the Chancellor set out a Budget that delivers on our pledge to cut debt and borrowing.”
Martin Beck at WPI Strategy said “confidence remains the missing ingredient”.
“A clear and credible pro-growth strategy from the Government – and an end to the pervasive gloom surrounding the UK economy – may matter just as much for the public finances as the fine print of future tax and spending plans,” he said.
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NPS Gets A Major Overhaul In 2025: What The New Rules Mean For Your Retirement Money?
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