US President Donald Trump’s administration has exempted smartphones, computers, and certain other electronic devices from reciprocal tariffs, including the 125% levies imposed on Chinese imports.
US Customs and Border Patrol published a notice late on Friday, explaining that these goods would be excluded from Trump’s 10% global tariff on most countries and the significantly higher Chinese import tax.
This move comes after concerns from US tech companies that the prices of gadgets could skyrocket, as many of them are manufactured in China.
This is the first substantial reprieve of any kind in Trump’s tariffs on China, with one trade analyst describing it as a “game changer scenario.”
The exemptions, backdated to April 5, also include other electronic devices and components, such as semiconductors, solar cells, and memory cards.
The White House indicated that the exemptions were made to provide companies with more time to relocate their production to the US.
White House Press Secretary Karoline Leavitt stated in a statement, “President Trump has made it clear that America cannot rely on China to manufacture critical technologies like semiconductors, chips, smartphones, and laptops. At the President’s direction, these companies are urgently working to relocate their manufacturing to the United States as soon as possible.”
Trump, who is spending the weekend at his Florida home, expressed his comfort with the high tariffs on China during a press conference on Friday.
He expressed optimism that something positive will emerge from this situation and highlighted his positive relationship with Chinese President Xi Jinping.
Some estimates suggested that iPhone prices and other electronic goods in the US would have increased by three times if the costs of the tariffs had been passed on to consumers.
Dan Ives, the global head of technology research at Wedbush Securities, expressed his enthusiasm for this scenario, stating, “This is the dream scenario for tech investors. The exclusion of smartphones and chips from the tariffs is a game changer when it comes to China tariffs.”
Big tech firms like Apple, Nvidia, Microsoft, and the broader tech industry can breathe a huge sigh of relief this weekend into Monday, according to him.
The US is a significant market for iPhones, and Apple accounted for over half of its smartphone sales last year, as reported by Counterpoint Research.
Counterpoint Research also revealed that a substantial portion of Apple’s iPhones intended for US sale are manufactured in China, with the remaining 20% produced in India.
In recent years, Apple, along with fellow smartphone giants like Samsung, has been actively diversifying its supply chains to mitigate over-reliance on China.
India and Vietnam have emerged as frontrunners for establishing additional manufacturing hubs.
As tariffs took effect, Apple reportedly accelerated and increased its production of India-produced devices in recent days.
Trump had initially planned to impose a series of steep tariffs on various countries worldwide, which were set to go into effect this week.
However, on Wednesday, he swiftly reversed course, announcing a 90-day pause for countries affected by higher US tariffs, except for China. Trump justified this decision by citing China’s readiness to retaliate with its own 84% levy on US goods.
In a significant policy shift, Trump declared that all countries that had not retaliated against US tariffs would receive a reprieve, facing only a blanket US tariff of 10% until July.
The White House later explained that this move was a negotiating tactic aimed at securing more favorable trade terms from other countries.
Trump has maintained that his import taxes are intended to address unfairness in the global trading system and to bring jobs and factories back to American shores.
It was unclear whether technology imports from China would still be subject to a 20% tariff that was not included in the reciprocal tariffs announced on April 2.
