Wyatte Grantham-Philips, AP Business Writer
President Donald Trump’s disruption over tariffs continues following weekend questions about the home appliance trade.
On Friday, the Trump administration suspended new taxes on electronic devices imported into the United States. It shows some relief from China, a technology exporter from smartphones to laptops, and particularly the escalating trade war. However, these products are subject to other taxes.
Authorities also indicate that additional sector-specific tariffs targeting electronics are ongoing. All economists warn that costs will be increased and consumer prices will be higher.
This is what we know.
Are electronics exempt from Trump’s latest tariffs?
Late Friday, US Customs and Border Protection said electronic devices, including smartphones and laptops, will be excluded from broader, so-called “mutual” tariffs. That is to say, these products are not subject to most tariffs that have been imposed on China so far or the 10% baseline tax imposed on other countries.
But U.S. Secretary of Commerce Howard Lutnick later said this was just a temporary reprieve. On Sunday, ABC’s “this week,” we will inform that electronics will be included in future sector-specific tariffs that are expected to arrive “probably a month.”
And not all taxes imposed by the US on countries like China fall under the White House “mutual” classification. Hours after Lutnick’s comment, Trump declared on social media that there were no “exceptions” and caused confusion. Instead, Trump claimed that these items were moving into “just another” buckets. He also said China still faces 20% collection on e-imports as part of his administration’s previous moves in relation to fentanyl trafficking.
How did China respond?
On Sunday, China’s Commerce Department welcomed a partial reprieve on home appliances, but the US continued to request it to cancel the remaining tariffs altogether.
Chinese President Xi Jinping reiterated on Monday that in an editorial jointly published in Vietnam and China’s official media, he wrote that “there are no winners in the trade war.” He added that both China and the US should “resolvedly protect the multilateral trading system, stable global industry and supply chains, and the open and cooperative international environment.”
Severe tariffs between the US and China have escalated to new heights in recent months. Since taking office in January, Trump has levied a series of taxes. This currently amounts to a 145% tax on various imports from the country.
In response, China has been struck by its own measures, including tariffs on US goods, currently totaling 125%. Its Commerce Department also says it will impose more export controls on rare earths, used in high-tech products such as computer chips and electric vehicle batteries.
What does reducing tariffs on electronic devices mean for consumers?
Customs duties are taxes on goods imported from other countries. And with many of the electronics we buy rely on a global supply chain, economists warn that tariffs that affect consumer technology could mean higher prices for your next smartphone, computer, or other gadget.
Temporarily reducing the size of these tariffs could delay or reduce the impact. However, it is unlikely that a price hike will be avoided entirely. Electronics will continue to be taxed by previous (non-‘mutual’) tariffs, potentially additional sector-specific taxation.
It is also extremely difficult for businesses to change their supply chains. The Trump administration has argued that tariffs will seduce celebrities like Apple, for example, to make the first iPhone in the US. But Apple has been building a finely tuned supply chain in China for decades. And it costs billions of dollars to build new plants in the US.
Dipanjan Chatterjee, vice president and principal analyst at Forrester, said in a memo on Monday that Apple will need to continue diversifying its supply chain “as a business” and set “Plan B” pricing for various product lines.
Trump signaled Monday that he spoke with Apple CEO Tim Cook before waived electronics from some of China’s tariffs. He tells reporters that he “helped” the cook with a partial reprieve and separately plans to offer a temporary exemption to automakers who need “a little time.” The Associated Press contacted Apple for a statement.
How does Wall Street react?
Tariffs have swayed financial markets around the world. In particular, the shares that were abused after Trump’s drastic announcement on April 2 were cooled down after news of this partial electronics exemption and a sudden non-China tariff suspension last week.
As of Monday afternoon, the S&P 500 was 0.2% higher, but after returning most of its early profit of 1.8%, the transaction remained volatile. Dow Jones’ industrial average increased by 57 points (0.1%), while Nasdaq Composite fell by 0.1%
Still, relief can be fleeting. When conditions appear to change every day, uncertainty remains high for many companies, where many companies are trying to develop long-term plans.
“Companies thrive in stability as they plan their engagement rules. Ergo, the market performs better when companies are convinced that the rules are actually rules,” Chattersee wrote Monday. Still, he added that companies should avoid knee hair responses while assessing the risk. “If Friday’s policy is thrown away with leftovers from Friday’s brunch, businesses rely on one key strategy. As little as possible, it’s not harmful.”
Washington Associated Press Writer Josh Baulke, May Anderson of Nashville and Matt O’Brien of Providence, Rhode Island contributed to the report.
Original issue: April 14th, 2025, 3:35pm EDT
