In addition to his threat to impose tariffs on all imports from Canada and Mexico, Trump has announced his intention to implement duties of up to 100% on silicon chips coming into the United States.
There are claims that this could raise the prices of all Apple products, given that its chips are manufactured in Taiwan; however, that is unlikely to be the case.
Proposed tariffs on imported chips
The Register has reported that Trump intends to set the tariffs as high as 100%.
“In the near future, we will be imposing tariffs on the foreign production of computer chips, semiconductors, and pharmaceuticals in order to bring the production of these essential goods back to the United States of America,” the US president stated during the House Republican Issues Conference.
“The incentive will be that they won’t want to pay a 25, 50, or even 100 percent tax,” he added.
A 100% tariff could potentially double the cost of chips imported by US companies for their American-manufactured electronics. These increased costs would likely be passed on to consumers as higher retail prices.
Unlikely impact on Apple devices
Some analysts suggest that since all Apple devices utilize processors produced in Taiwan and other chips largely made in China, the company could face repercussions from these tariffs.
Nevertheless, chips manufactured by TSMC in Taiwan are typically sent to countries such as China, India, and Vietnam for assembly into devices before being imported back to the US.
If tariffs on chips applied to every device containing them, it would affect a wide array of products, from smartwatches to washing machines and even automobiles.
This situation is markedly different from the tariffs implemented by Trump during his previous administration. Those tariffs directly impacted Apple products, yet the company successfully argued for many of its devices to be exempted, citing the economic harm it would cause to the US.
Trump has often misrepresented tariffs as a tax imposed on foreign companies exporting to the US. In reality, these tariffs are enacted on imported goods at their point of entry and are paid by the American companies and consumers importing those products.
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