Exemptions for tech giants offer temporary relief, but Commerce Secretary warns new tariffs are on the way
President Donald Trump has granted a sweeping exemption for smartphones, laptops, and other electronics from his recently imposed “reciprocal tariffs”—but his own officials now suggest the reprieve may be short-lived.
The move, announced late Friday by U.S. Customs and Border Protection, removes some of the steepest tariffs—up to 145%—from a range of high-tech goods, including computers, flash drives, semiconductors, and flat-panel displays. The exemptions apply retroactively to shipments that left warehouses on or before 5 April, and they mark a significant if temporary victory for major U.S. tech companies like Apple, Nvidia, and Microsoft, which manufacture the bulk of their products in China.
Apple, which assembles roughly 90% of its iPhones in China, had seen its market value plunge more than US$640bn in the days after Trump’s tariff announcement. Analysts warned that without the exemption, the cost of an iPhone could have soared to over US$3,500.
But if the exemption offered a sigh of relief, it was a short one.
On Sunday, Commerce Secretary Howard Lutnick said the products exempted from Trump’s reciprocal tariffs will soon be subject to a different set of duties.
“They’re exempt from the reciprocal tariffs, but they’re included in the semiconductor tariffs, which are coming in probably a month or two,” Lutnick told ABC News. “So this is not like a permanent sort of exemption.”
The new semiconductor tariffs, which have not yet been finalised, are expected to be framed around national security concerns, part of a broader push by the administration to onshore chip manufacturing and reduce reliance on foreign suppliers.
“These are things that are national security that we need to be made in America,” Lutnick said.
U.S. Trade Representative Jamieson Greer offered a further layer of explanation—if not clarity. “This type of supply chain moved from the tariff regime for the global tariff, the reciprocal tariff, and it moved to the national security tariff regime,” he said on CBS’s Face the Nation.
The shifting rationale and rapid reversals have drawn sharp criticism from Democratic lawmakers, who accuse the administration of injecting confusion into an already volatile economic environment.
“Right now what we’ve got is chaos,” said Senator Elizabeth Warren on CNN. “Investors will not invest in the United States when Donald Trump is playing red light, green light with tariffs.”
Senator Cory Booker echoed the sentiment, calling the policy environment a “crisis of credibility.”
The broader context is one of escalating trade tensions. Trump earlier this month imposed a 145% reciprocal tariff on Chinese goods—part of a new tariff framework that also includes a 10% baseline rate for most other countries. Days later, he announced a 90-day pause on implementing the higher rates—excluding China—as a gesture of goodwill toward allies. Friday’s exemptions appeared to soften the blow on consumers and corporations alike, but they also raised questions about the administration’s endgame.
“Trump’s trade policy right now feels like it’s being written in real time,” said one analyst.
White House officials have attempted to justify the electronics exemptions as a stopgap measure designed to give companies time to relocate production to the U.S. “At the direction of the President, these companies are hustling to onshore their manufacturing in the United States as soon as possible,” said deputy press secretary Kush Desai.
But few believe a large-scale reshoring of semiconductor and electronics production is feasible in the short term. One report estimated it would take US$30bn and three years just to relocate 10% of Apple’s supply chain.
Meanwhile, the economic fallout has been immediate. The S&P 500 dropped more than 5% during the week of Trump’s tariff escalation, while the 10-year Treasury yield jumped more than 50 basis points—one of its largest weekly moves on record. Analysts believe the market pressure may have helped trigger the administration’s partial reversal.
Yet uncertainty persists. The exemptions do not apply to the 20% fentanyl-linked tariff already imposed on all Chinese goods. Nor do they insulate electronics from potential sector-specific tariffs—such as those on semiconductors—that the administration has said are still in the works.
“This exemption only covers one segment of the U.S. economy,” said Gerard DiPippo, associate director of the Rand China Research Center. “Many other consumer, intermediate, and capital goods from China still face prohibitively high U.S. tariffs.”
For now, the message from the administration is that flexibility is part of the strategy.
“There could be a couple of exceptions for obvious reasons,” Trump told reporters on Air Force One. “But I would say 10% is a floor.”
