By Ethan Faverino |

In response to the U.S. Supreme Court’s February decision in Learning Resources, Inc. v. Trump, which held that the International Emergency Powers Act (IEEPA) does not authorize the President to impose tariffs, Joint Economic Committee (JEC) Chairman David Schweikert (AZ-01) issued a statement encouraging a shift toward a more stable and growth-oriented tax framework.

In a 6-3 ruling, the Supreme Court invalidated sweeping tariffs imposed under IEEPA, concluding that the statute does not grant the executive branch authority to levy import duties. The Court reaffirmed that Congress holds constitutional authority over tariffs and taxation, rejecting arguments that IEEPA’s provisions governing economic measures during national emergencies extend to imposing duties.

Chairman Schweikert emphasized the broader implications for America’s tax system amid rising federal spending. “As our nation’s spending continues to grow, we must be honest about the math,” he stated. “To sustain essential programs and protect our fiscal health, we need a tax system that produces stable, predictable receipts without stifling growth. Today’s ruling underscores the uncertainty in our current tax framework, uncertainty that limits investment, hiring, and innovation.”

Schweikert advocated for transitioning to a border-adjusted, destination-based cash flow tax (DBCFT) as a superior alternative to tariffs for promoting domestic production and economic competitiveness. “To bring greater stability and competitiveness to our economy, and address tax arbitrage arising from other countries’ tax policies, I believe the U.S. should move toward a border-adjusted, destination-based cash flow tax. In line with the goals of tariffs, a DBCFT supports U.S.-based production and American workers. But tariffs distort markets and reduce overall output. A destination-based cash flow tax achieves these same objectives through a more economically rational, growth-oriented framework.”

He highlighted key advantages of the DBCFT, including immediate deductions for business investments to encourage reinvestment and growth, taxation based on where goods are consumed rather than where they are produced, and border adjustments that tax imports while exempting exports.

This approach, Schweikert noted, discourages offshoring, provides businesses with predictability for long-term planning, and helps ensure stable tax revenues to support increasing federal expenditures.

“I will be holding a hearing on this important topic in the coming weeks,” he added. “America’s long-term prosperity hinges on our ability to keep U.S. companies competitive both at home and globally. A destination-based cash flow tax strengthens that foundation.”

Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.