Smartphones, laptops excluded from latest tariffs
White House press briefing: Karoline Leavitt on tariffs
White House press secretary Karoline Leavitt held a news conference at the White House on Friday. Leavitt focused on tariffs and the economy.
Certain electronics including smartphones and laptops will be exempt from the "reciprocal" tariffs imposed by President Donald Trump, his administration said.
That means they won’t be subject to the current 145% tariffs levied on China or the 10% baseline tariffs elsewhere.
Why are smartphones excluded from tariffs?
What we know:
U.S. Customs and Border Protection said items like smartphones, laptops, hard drives, flat-panel monitors, some chips and machines used to make semiconductors are exempt.
RELATED: Chinese-based Amazon sellers weigh price hikes or exiting US market: report
The announcement was made late Friday and includes the import taxes on China, where many electronics are made.
The move could keep prices down for popular consumer electronics that aren’t typically made in the U.S. It would also help chipmakers like Nvidia.
What we don't know:
CBP didn’t say why they were exempting these specific electronics, but large tech companies like Apple and Samsung have raised concerns that smartphones could triple in cost if the tariffs are passed on to customers.
The Trump administration announced it is exempting smartphones like the iPhone pictured here from tariffs (Photo by Jakub Porzycki/NurPhoto via Getty Images)
What they're saying:
The move takes off "a huge black cloud overhang for now over the tech sector and the pressure facing U.S. Big Tech," said Wedbush analyst Dan Ives in a research note.
RELATED: Tariff update: Here's what the US imports from China
Trump previously said he would consider exempting some companies from tariffs.
By the numbers:
Up to 80% of Apple's iPhones made for U.S. sales are manufactured in China, with the remaining 20% made in India, according to BBC.
Trump tariffs latest
China retaliates with 125% tariffs on US goods
China announced Friday that it will raise tariffs on U.S. goods from 84% to 125% — the latest salvo in an escalating trade war between the world’s two largest economies that has rattled markets and raised fears of a global slowdown.
The backstory:
Trump announced sweeping tariffs on a wide range of countries on April 2, upending financial markets and leading to Wall Street's worst days since the pandemic started in 2020.
But in a Truth Social post a week later, the president announced a 90-day pause on new tariffs, except for China, which he raised to 125%, "effective immediately."
RELATED: Trump tariff summary: Where things stand after pause
By the numbers:
The turmoil battered the stocks of tech’s "Magnificent Seven" -- Apple, Microsoft, Nvidia, Amazon, Tesla, Google parent Alphabet and Facebook parent Meta Platforms. At one point earlier this week, the combined Magnificent Seven’s combined market value had plunged by $2.1 trillion, or 14%, from April 2.
Some of the losses eased this past Wednesday when Trump paused the tariffs outside of China, paring the lost value in the Magnificent Seven to $644 billion, or a 4% decline, from April 2.
What's next:
Now, the stage is set for another tech rally Monday when trading resumes in the U.S. stock market, with Apple likely leading the way because the iPhones made in China remain the company’s biggest money maker.
The electronics exemption also should relieve consumer worries that the China tariffs would result in hefty price hikes on smartphones and other devices that have become essential tools of modern living.
Dig deeper:
Trump has said the tariffs will bring manufacturing back to the U.S, but it would take several years and cost billions of dollars for companies like Apple to build new plants in the U.S., and would still drastically raise the price of iPhones. Apple tried to appease Trump in February by announcing plans to spend $500 billion and hire 20,000 people in the U.S. through 2028, but none of it was tied to making an iPhone domestically. Instead, Apple pledged to fund a Houston data center for computer servers powering artificial intelligence — a technology the company is expanding into as part of an industrywide craze.
The exemption announced late Friday seemed to reflect the president’s realization that his China tariffs are unlikely to shift more manufacturing of smartphones, computers and other gadgets to the U.S. any time soon, if ever, despite the administration’s predictions.
The Source: This report includes information from The Associated Press, BBC and previous LiveNow from FOX reporting.