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Semiconductors, flat-panel displays excluded from reciprocal tariffs

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Tech company CEOs embracing Trump in second administration

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Trump's keeps 20% fentanyl-related tariffs on all Chinese imports

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Latest tariff exclusions suggest growing awareness of consumer pain

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Smartphones, laptops were largest US imports from China in 2024

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Trump promises more details on Monday

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China calls move 'a small step' by U.S. to correct its wrong practice

By David Lawder and Jeff Mason

WASHINGTON/WEST PALM BEACH, Florida, April 13 (Reuters) - U .S. President Donald Trump's administration granted exclusions from steep tariffs on smartphones, computers and some other electronics imported largely from China, providing a big break to tech firms like Apple ( AAPL ) that rely on imported products.

China said it was evaluating the impact of the exclusions. In a statement on Sunday, the Ministry of Commerce called the move a "small step by U.S. to correct its wrong practice of unilateral 'reciprocal tariffs'."

"The bell on a tiger's neck can only be untied by the person who tied it," the ministry said, urging the U.S. to make a major step in correcting what it called its wrongdoing and cancelling the tariffs completely.

In a notice to shippers late on Friday, the U.S. Customs and Border Protection agency published a list of tariff codes excluded from the import taxes, with retroactive effect from 12:01 a.m. EDT (0401 GMT) on April 5.

It featured 20 product categories, including the broad 8471 code for all computers, laptops, disc drives and automatic data processing. It also included semiconductor devices, equipment, memory chips and flat panel displays.

The notice gave no explanation for the move, but the exclusion provides welcome relief to major technology firms such as Apple ( AAPL ), Dell Technologies ( DELL ) and many other importers.

The action also excludes the specified electronics from Trump's 10% "baseline" tariffs on goods from most countries other than China, easing import costs for semiconductors from Taiwan and Apple ( AAPL ) iPhones produced in India.

Asked on Saturday about his reasoning for the exemptions and plans for semiconductors, Trump told reporters: "I'll give you that answer on Monday. We'll be very specific on Monday ... we're taking in a lot of money, as a country, we're taking in a lot of money."

For the Chinese imports, the exclusion of the tech products applies only to Trump's reciprocal tariffs, which climbed to 125% this week, according to a White House official. Trump's prior 20% duties on all Chinese imports that he said were related to the U.S. fentanyl crisis remain in place.

But the official said Trump would launch a new national security trade investigation into semiconductors soon that could lead to other new tariffs.

Wedbush Securities analyst Dan Ives called the announcement about the tech exclusions "the most bullish news we could have heard this weekend."

"There is still clear uncertainty and volatility ahead with these China negotiations.... Big Tech firms like Apple ( AAPL ), Nvidia ( NVDA ), Microsoft ( MSFT ) and the broader tech industry can breathe a huge sigh of relief this weekend into Monday," Ives said in an industry note.

Beijing increased

its own tariffs on U.S. imports to 125% on Friday,

hitting back

against Trump's decision to further raise duties on Chinese goods and increasing the stakes in a trade war that threatens to upend global supply chains.

On Wednesday, Trump had announced a reprieve for levies on dozens of countries while

ratcheting up tariffs

on Chinese imports effectively to 145%.

Many tech company CEOs have embraced Trump as he begins his second term, attending his January 20 inauguration and celebrating with him afterward. Apple ( AAPL ) CEO Tim Cook hosted a pre-inaugural ball and has visited Trump at his home in Florida.

White House spokesperson Karoline Leavitt said in a statement that Trump has made clear the U.S. cannot rely on China to manufacture critical technologies such as semiconductors, chips, smartphones and laptops.

But she said that at Trump's direction, major tech firms, including Apple ( AAPL ) and chipmakers Nvidia ( NVDA ) and Taiwan Semiconductor "are hustling to onshore their manufacturing in the United States as soon as possible."

TARIFF PAIN

The exemptions suggest an increasing awareness within the Trump administration of the effect of his tariffs on U.S. consumers who are weary of inflation.

Even at a lower 54% tariff rate on Chinese imports, analysts predicted the price of a top-end Apple ( AAPL ) iPhone could jump to $2,300 from $1,599. At 125%, economists and analysts have said U.S.-China trade could largely halt.

Smartphones were the top U.S. import from China in 2024, totaling $41.7 billion, while Chinese-built laptops were second, at $33.1 billion, according to U.S. Census Bureau data.

Apple ( AAPL ) recently chartered cargo flights to ferry 600 tons of iPhones, or as many as 1.5 million, to the U.S. from India, after it stepped up production there in an effort to beat Trump's tariffs, Reuters reported on Friday.

Trump's White House campaign last year focused on a vow to bring down prices. But he also promised to impose the tariffs that he views as essential to realigning the world trading order and he has dismissed turbulence in financial markets and price increases from the levies as a necessary disturbance.

His so-called "reciprocal tariffs," however, have raised fears of a U.S. recession and have drawn criticism from some of his fellow Republicans, who do not want to lose control of Congress in next year's mid-term elections.

Trump told reporters on Friday he was comfortable with the high tariffs on China but had a good relationship with President Xi Jinping and believed something positive would come out of the trade conflict between them.

His tariff moves have caused turmoil on financial markets. U.S. stocks ended a volatile week higher, but the safe haven of gold hit a record high during the session and benchmark U.S. 10-year government bond yields posted their biggest weekly increase since 2001 alongside a slump in the dollar, signaling a lack of confidence in the U.S.

(Reporting by David Lawder in Washington, Jeff Mason in West Palm Beach, Florida Additional reporting by Ismail Shakil in Ottawa and David Brunnstrom in Washington, Beijing and Shanghai Newsrooms Writing by David Lawder and Patricia Zengerle Editing by Paul Simao, Clarence Fernandez and Frances Kerry)