Smartphones and Computers Exempted from New Tariffs in US Trade Policy Shift

In a major policy shift, the US government exempts smartphones and computers from new tariffs, easing concerns over rising gadget prices.

US President Donald Trump’s administration recently announced that smartphones and computers will be exempt from the reciprocal tariffs that include the hefty 125% levies placed on imports from China. This development was shared by the US Customs and Border Patrol in a notice published late Friday, highlighting the goods' exclusion from Trump's global 10% tariffs imposed on various countries, as well as the more severe Chinese import taxes.

Tech companies in the US raised alarms regarding the potential surge in prices for gadgets, many of which are manufactured in China. This exemption extends beyond just smartphones and computers to cover a range of electronic devices and critical components like semiconductors, solar cells, and memory cards. Notably, the US remains a significant market for products like iPhones, with Apple reportedly representing over 50% of the smartphone sales last year, according to data from Counterpoint Research.

With approximately 80% of iPhones intended for the US market being made in China, and 20% in India, companies like Apple and Samsung have been under pressure to diversify their production efforts and reduce reliance on Chinese manufacturing. India and Vietnam have emerged as strong candidates for establishing additional manufacturing facilities. Following the imposition of these tariffs, Apple has been accelerating its push to boost the production of devices made in India.

In an unexpected turn of events, Trump had initially planned to implement steep tariffs on numerous countries, effective this week. However, he quickly changed course on Wednesday, declaring a 90-day delay for all nations facing higher US tariffs, except for China, where left the tariffs inflated at 145%. This increase stems from China's willingness to retaliate with an 84% levy on US goods. The White House defined this shift as a negotiating tactic aimed at securing more favorable trade agreements from other nations.

Trump has consistently claimed that his tariff strategy aims to correct what he perceives as imbalances in the global trading system, in addition to bringing jobs and manufacturing back to the United States.