President Donald Trump put to rest any speculation about possible exemptions from his latest round of tariffs on Chinese-made electronics, confirming that iPhones and similar devices will not be spared.
“NOBODY is getting ‘off the hook,’” Trump declared on Truth Social Sunday. “There was no Tariff ‘exception’ announced on Friday. These products are subject to the existing 20% Fentanyl Tariffs, and they are just moving to a different Tariff ‘bucket.’” He added, “We are taking a look at Semiconductors and the WHOLE ELECTRONICS SUPPLY CHAIN in the upcoming National Security Tariff Investigations.”
On Friday, a rule was issued that seemed to exclude many consumer electronics from Trump’s aggressive “reciprocal” tariffs targeting Chinese imports, prompting confusion about whether Apple and other tech giants had been granted a reprieve.
The rule raised eyebrows because Apple and similar companies had been bracing for levies of up to 145% under Trump’s new trade framework. With more than 80% of Apple’s products assembled in China, according to Evercore ISI, the announcement seemed like a major break. Apple CEO Tim Cook has worked closely with Trump throughout the tariff standoff.
Some analysts had predicted even before the latest developments that iPhones could climb in price to $2,300 if tariffs were fully imposed.
Commerce Secretary Howard Lutnick attempted to clarify the administration’s position during an appearance on ABC’s This Week, stating that electronics from China will still be taxed under a different classification.
“So what he’s doing is he’s saying they’re exempt from the reciprocal tariffs, but they’re included in the semiconductor tariffs, which are coming in probably a month or two. So these are coming soon,” Lutnick said.
He added, “All those products are going to come under semiconductors, and they’re going to have a special focus type of tariff to make sure that those products get restored.”
Last week, just before the reciprocal tariff structure was set to go into effect, Trump surprised markets by pausing the rollout for 90 days to give his administration more time to renegotiate trade deals. He admitted the decision was in part due to market volatility, saying that some people were “getting a little bit yippy, a little bit afraid.”
Despite the delay, the 10% baseline tariff remains intact across most imports, and China still faces a 125% penalty under the broader plan. Additionally, the 20% fentanyl-related tariff announced earlier this year remains in place, bringing the total effective rate on many Chinese goods to as high as 145%.
China is currently the United States’ third-largest trade partner. Trump emphasized the need for self-sufficiency in manufacturing, particularly in strategic industries.
“What has been exposed is that we need to make products in the United States, and that we will not be held hostage by other Countries, especially hostile trading Nations like China, which will do everything within its power to disrespect the American People,” he stated.
Trump’s earlier fentanyl-linked tariffs still apply to a wide range of electronics, including those coming from China. Lutnick stressed the importance of rebuilding domestic manufacturing capacity. “We need to have semiconductors, we need to have chips, and we need to have flat panels — we need to have these things made in America. We can’t be reliant on Southeast Asia for all of the things that operate for us,” he said.
Lutnick also said the administration is considering tariff-based strategies to bring pharmaceutical manufacturing back to the United States. “We can’t be beholden and rely upon foreign countries for fundamental things that we need,” he explained. “So this is not like a permanent sort of exemption. He’s just clarifying that these are not available to be negotiated away by countries. These are things that are national security that we need to be made in America.”
Before Trump issued the delay in customized tariffs last Wednesday, administration officials had made clear that the president had no intention of offering carve-outs and that the aggressive protectionist approach was not a bluff.
Peter Navarro, senior counselor for trade and manufacturing, reiterated on Sunday that Trump remains firm on this front. “The policy is no exemptions, no exclusions,” he said, despite the seeming relief for the electronics sector.
Navarro noted that the structure of the semiconductor market complicates enforcement. “The problem, interestingly for chips, because this is very complex stuff, is that we don’t buy a lot of chips, like in bags. We buy them in products. So what Secretary of Commerce Howard Lutnick is doing as we speak is an investigation of the chip supply chain,” Navarro said during an appearance on NBC’s Meet the Press.
It is still unknown what rate Trump intends to set for the upcoming semiconductor-specific tariffs.
Former President Joe Biden attempted to boost domestic chip production with the 2022 CHIPS and Science Act, which provided financial incentives to semiconductor manufacturers. Trump, however, has repeatedly criticized the legislation, arguing that tariffs are a more effective method to bring manufacturing back to American soil.
{Matzav.com}