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US President Donald Trump’s administration granted exclusions from steep tariffs on smartphones, computers and some other electronics imported largely from China, providing a big break to tech firms like Apple that rely on imported products.
Read-Trump tariff hike: China raises duties on US goods to 125%
China said it was evaluating the impact of the exclusions. In a statement on Sunday, the Ministry of Commerce called the move a “small step by US to correct its wrong practice of unilateral ‘reciprocal tariffs’.”
“The bell on a tiger’s neck can only be untied by the person who tied it,” the ministry said, urging the US to make a major step in correcting what it called its wrongdoing and cancelling the tariffs completely.
In a notice to shipperslate on April 11, the US Customs and Border Protection agency published a list of tariff codes excluded from the import taxes, with retroactive effect from 12:01 a.m. EDT (0401 GMT) on April 5.
Product categories
It featured 20 product categories, including the broad 8471 code for all computers, laptops, disc drives and automatic data processing. It also included semiconductor devices, equipment, memory chips and flat panel displays.
The notice gave no explanation for the move, but the exclusion provides welcome relief to major technology firms such as Apple, Dell Technologies and many other importers.
The action also excludes the specified electronics from Trump’s 10 per cent “baseline” tariffs on goods from most countries other than China, easing import costs for semiconductors from Taiwan and Apple iPhones produced in India.
Asked on Saturday about his reasoning for the exemptions and plans for semiconductors, Trump told reporters: “I’ll give you that answer on Monday. We’ll be very specific on Monday … we’re taking in a lot of money, as a country, we’re taking in a lot of money.”
Chinese imports
For the Chinese imports, the exclusion of the tech products applies only to Trump’s reciprocal tariffs, which climbed to 125 per cent this week, according to a White House official. Trump’s prior 20 per cent duties on all Chinese imports that he said were related to the US fentanyl crisis remain in place.
But the official said Trump would launch a new national security trade investigation into semiconductors soon that could lead to other new tariffs.
Wedbush Securities analyst Dan Ives called the announcement about the tech exclusions “the most bullish news we could have heard this weekend.”
“There is still clear uncertainty and volatility ahead with these China negotiations…. Big Tech firms like Apple, Nvidia, Microsoft and the broader tech industry can breathe a huge sigh of relief this weekend into Monday,” Ives said in an industry note.
Beijing increased its own tariffs on US imports to 125 per cent on Friday, hitting back against Trump’s decision to further raise duties on Chinese goods and increasing the stakes in a trade war that threatens to upend global supply chains.
On Wednesday, Trump had announced a reprieve for levies on dozens of countries while ratcheting up tariffs on Chinese imports effectively to 145 per cent.
Many tech company CEOs have embraced Trump as he begins his second term, attending his January 20 inauguration and celebrating with him afterward. Apple CEO Tim Cook hosted a pre-inaugural ball and has visited Trump at his home in Florida.
White House spokesperson Karoline Leavitt said in a statement that Trump has made clear the US cannot rely on China to manufacture critical technologies such as semiconductors, chips, smartphones and laptops.
But she said that at Trump’s direction, major tech firms, including Apple and chipmakers Nvidia and Taiwan Semiconductor 2330.TW “are hustling to onshore their manufacturing in the United States as soon as possible.”
Tariff pain
The exemptions suggest an increasing awareness within the Trump administration of the effect of his tariffs on US consumers who are weary of inflation.
Even at a lower 54 per cent tariff rate on Chinese imports, analysts predicted the price of a top-end Apple iPhone could jump to $2,300 from $1,599. At 125 per cent, economists and analysts have said US-China trade could largely halt.
Smartphones were the top US import from China in 2024, totaling $41.7bn, while Chinese-built laptops were second, at $33.1bn, according to US Census Bureau data.
Apple recently chartered cargo flights to ferry 600 tons of iPhones, or as many as 1.5 million, to the US from India, after it stepped up production there in an effort to beat Trump’s tariffs, Reuters reported on Friday.
Trump’s White House campaign last year focused on a vow to bring down prices. But he also promised to impose the tariffs that he views as essential to realigning the world trading order and he has dismissed turbulence in financial markets and price increases from the levies as a necessary disturbance.
His so-called “reciprocal tariffs,” however, have raised fears of a US recession and have drawn criticism from some of his fellow Republicans, who do not want to lose control of Congress in next year’s mid-term elections.
Trump told reporters on Friday he was comfortable with the high tariffs on China but had a good relationship with President Xi Jinping and believed something positive would come out of the trade conflict between them.
His tariff moves have caused turmoil on financial markets. US stocks ended a volatile week higher, but the safe haven of gold hit a record high during the session and benchmark US 10-year government bond yields posted their biggest weekly increase since 2001 alongside a slump in the dollar, signaling a lack of confidence in the US.
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