Apple says Watch, AirPods, and chargers will be more expensive under Trump tariffsSeptember 7, 2018
Apple says the United States’ latest round of proposed tariffs on China would affect a number of its up and coming products, including the Apple Watch, AirPods, and HomePod. The proposed tariffs would put a 25 percent tax either on the products themselves or on components within the products, raising the price on them and likely depressing sales as well.
Several other products would also be hit, according to a letter submitted by Apple to the US Trade Representative earlier today. Apple says the Mac Mini, Pencil, its wireless mouse and trackpad, leather cases and covers, and some adapters, chargers, cables, and internal components would also be impacted by the tariffs.
Apple asks that the US revise its proposal and decline to place tariffs on the product categories that cover these devices. “It is difficult to see how tariffs that hurt US companies and US consumers will advance the government’s objectives with respect to China’s technology policies,” Apple writes.
Until now, the US and China had avoided placing tariffs that would affect major technology products — an area where the countries have a strong relationship. Apple, in particular, has been an obvious point of concern. The company’s US-developed hardware products have made it one of the richest companies in the world, but those products are built in China, creating a huge number of jobs.
While the US did not explicitly say it would tax smartwatches or wireless headphones, the government did say it might tax “machines for the reception, conversion, and transmission or regeneration of voice,” which could describe many Apple products, as well as more specific technology categories like “plugs and sockets for making connections to or in electrical circuits” up to a certain voltage.
This round of tariffs was proposed throughout June and July as part of President Trump’s ongoing feud with China over its trade practices. The proposal called for tariffs on $200 billion worth of Chinese goods. The proposal’s public comment period closes today; Apple’s comment was filed Wednesday but just became public.
Apple said that, if applied, the tariffs would “show up as a tax on US consumers” and ultimately “increase the cost of Apple products.” The company says this would put it at a disadvantage relative to foreign competitors, and that the US would be hit the hardest by taxing these categories.
It’s still unclear when the proposed tariffs will go into effect, or whether there will be significant changes or exceptions in the final list. “We will evaluate the comments and we will make a decision,” said White House economic adviser Larry Kudlow in an interview this morning with Bloomberg TV.