Apple iPhone might have escaped import tax in the nick of time (UPDATE: It's official)

Apple iPhone might have escaped import tax in the nick of time (UPDATE: It's official)
Reuters, citing unnamed sources, said today that the U.S. and China have reached an agreement on the "first phase" to de-escalate the trade war between the two countries. As a result of the agreement, Apple iPhone units imported from China might not be subject to the 15% import tax that was scheduled to begin on December 15th. While the device is designed in the states, the majority of units are assembled in China; 40% of global iPhone shipments are made from the U.S.

UPDATE: President Donald J. Trump has signed the trade deal with China which means that there will be no tariffs on the iPhone, iPad and other Apple products. "Trump delivered an early Christmas present to Apple," said Wedbush analyst Dan Ives. "If this tariff went through it would have been a major gut punch for semi players/Apple and could have thrown a major wrench into the supply chain and demand for the holiday season.

Apple already has some other products that are affected by the tariffs including the Apple Watch and the AirPods, but Apple has decided to eat the additional cost itself rather than passing all or some of it on to consumers in the form of higher prices. The trade war was initiated by U.S. President Donald Trump who considered the country's trade deficit with China to be a sign that its trading partner was taking advantage of the U.S. Many economists say that it only showed that American consumers were better off financially than their counterparts in China and could afford to buy more goods from China than the Chinese could afford to buy from the states.

The deal reached today, although not officially announced by either side, will reportedly suspend the 15% tariffs that would have been imposed on $160 billion worth of Chinese imports (including the iPhone and other smartphones) on December 15th. It also will reduce tariffs by as much as 50% on other products that are already being taxed. That could include the Apple wearables that we previously mentioned along with some iPhone and iPad cases and some additional products. In exchange, China will purchase $50 billion in U.S. agricultural goods, twice the amount it spent in 2017 before the start of the trade war.

Apple CEO Tim Cook successfully played the "Samsung card" with the President


The trade war between the two large nations has had a negative impact globally. And while many are glad that the two sides have come together, others aren't sure whether an agreement in principle or an actual agreement was made. A source in Washington D.C. told Reuters, "Until the full text is released, it’s not particularly actionable. It’s very unclear to me: Is this an agreement in principle or is it an agreement?"

That the iPhone has avoided the tariff might be a coincidence, but Apple CEO Tim Cook does have an unusual relationship with President Trump. Back in August, Cook explained to Trump how tariffs against Apple's handset could end up helping Samsung by allowing the Korean outfit to beat Apple on price. After all, Samsung is not required to pay an import tax on its products shipped to the U.S. Three months later, the president said that he might exempt Apple from paying tariffs on its products made in China parroting back Cook's thoughts. "The problem we have is you have Samsung," Trump stated. "It’s a great company but it’s a competitor of Apple, and it’s not fair if, because we have a trade deal with Korea - we made a great trade deal with South Korea - but we have to treat Apple on a somewhat similar basis as we treat Samsung."


The president has several times incorrectly stated that the Chinese are paying millions of dollars to the U.S. Treasury as a result of the tariffs. But the tariffs are merely an import tax that actually impacts American companies and consumers. The former pay the tax and either take a cut in their profit margin as a result or they have consumers pay by raising prices. Trump himself admitted as such by pushing back the 15% import tax on the iPhone, which was supposed to begin in September. At the time, the president said that this was done so that the U.S. economy wouldn't be harmed during the holiday shopping season. If China was paying millions to the U.S. as a result of the tariffs, as Trump stated, delaying the imposition of them would have been counter-intuitive.

Experts believe that if Trump doesn't sign off on this "first phase" agreement, China will suspend talks until after the next U.S. presidential election next November.

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41 Comments

1. MsPooks

Posts: 311; Member since: Jul 08, 2019

Samsung already beats Apple on price. And everything else, really.

3. Busyboy

Posts: 739; Member since: Jan 07, 2015

Except the latest iPhone's completely blow Samsung out of the water. Better performance, camera, display, haptics, battery life, design, software support, resale value - the list goes on. Apple has Samsung beat.

11. maherk

Posts: 7066; Member since: Feb 10, 2012

Note 10 user, and I can't but agree with you on that. While they're not that far away from each other, the iPhone 11 Pro definitely is better than the Note 10 this year, for all the reasons that you have mentioned.

12. JCASS889 unregistered

Apple has Samsung beat in phone and tablets, but if Samsung goes away then there goes like 60% of the parts that make an iPhone go away. Your iPhone is literally nothing without Samsung and other companies.

14. darkkjedii

Posts: 31772; Member since: Feb 05, 2011

I own both, and disagree. iOS 13 is a stability nightmare. Several bugs remain, and the cameras are basically equal. Design strongly goes to the note, display goes to the note, resale to the iPhone, and software support to the iPhone. Android 9, with UI 1.5 is killing iOS. See, I can make my decision too, only I use both.

19. MsPooks

Posts: 311; Member since: Jul 08, 2019

iPhones still choke on RAM management. iPhones still tint every picture out of their cameras with yellow, and just now caught up to 2018 Android camera arrays. Design is subjective, but we get that you like huge notches and stove tops. iPhone FINALLY got better battery life by Apple reluctantly admitting that there's no substitute for...bigger batteries. iPhone displays are made by Samsung; deep. Software support is needed because every release is a buggy mess; iOS has seen three revisions in as many months...junk. The list goes on. Haptics? Seriously?

29. ScottsoNJ56

Posts: 158; Member since: Oct 01, 2017

At least Apple has software support. Unlike most android handsets

33. tedkord

Posts: 17514; Member since: Jun 17, 2009

And they need it. While every software update I've gotten on my Note 8 and Note 9 have been rock solid stable, iOS had been a buggy mess for years.

32. Feanor

Posts: 1434; Member since: Jun 20, 2012

...design? ....seriously, DESIGN???

34. tedkord

Posts: 17514; Member since: Jun 17, 2009

Not so much.

4. mrochester

Posts: 1043; Member since: Aug 17, 2014

The Samsung just has a worse OS and ecosystem. But then that’s a pretty important part of a phone!

6. Nokfan1603

Posts: 75; Member since: Mar 13, 2013

An honest question? Why do you think that Samsung's OS is worse? Google Assistant is far superior, my Galaxy Watch looks more beautiful. The interaction with Galaxy Buds, Samsung TV and Samsung Tablet is perfect. And Android gives me so much freedom, that I can even have my Samsung Note's operating system look and behave similar to the iPhone's. So, please, where is iPhone's ecosystem better?

8. tbreezy

Posts: 252; Member since: Aug 11, 2019

The fact that you want your Note’s operating system to behave similar to iPhone says it all really. ;)

9. Nokfan1603

Posts: 75; Member since: Mar 13, 2013

Of course, I do not want that, it would take away a lot of the productivity gains of my Samsung Note. It is just an example of the incredible flexibility of the operating system, one of the infinite possibilities.

21. tbreezy

Posts: 252; Member since: Aug 11, 2019

If you have infinite possibilities why would you be wanting it to perform like iPhones then? Why would you even bother to comment on an iPhone topic if your note is so much better, LOL! A lot of contradictions in your story bud.

24. Nokfan1603

Posts: 75; Member since: Mar 13, 2013

Reading is not really your strong point, is it?

15. darkkjedii

Posts: 31772; Member since: Feb 05, 2011

I don’t want my Note to perform like an iPhone...screw that. The Note is king.

17. MsPooks

Posts: 311; Member since: Jul 08, 2019

He didn't say it's what he wants; he said that he could do it if he wanted to. Something Apple will NEVER allow.

22. tbreezy

Posts: 252; Member since: Aug 11, 2019

I hope Apple never allow that, one fragmented OS is enough in Mobile, let us enjoy cohesion in iOS , thanks.

30. darkkjedii

Posts: 31772; Member since: Feb 05, 2011

Right. I like both for how they perform, but damn, the iPhone could use 6 features to make it way better.

36. tedkord

Posts: 17514; Member since: Jun 17, 2009

The honest answer is because Apple. That's all it boils down to for him.

42. darkkjedii

Posts: 31772; Member since: Feb 05, 2011

Agreed 100%

26. JCASS889 unregistered

So an operating system that allows total freedom and customization is considered a bad thing? I can name a thousand things a Samsung phone can do that an iPhone can only hope to ever do.

35. tedkord

Posts: 17514; Member since: Jun 17, 2009

Android is far superior to iOS in function, power and stability.

18. ShadowSnypa786

Posts: 655; Member since: Jan 06, 2017

"Samsung already beats Apple on price. And everything else, really." Agreed Samsung Phone price's are cheaper which is good for the customer, I get why people love Apple's resale price when you come to sell it but when you buying the device then its a negative. SD card, Stylus, bigger display, small cut-out rather than an ugly notch, higher resolution display, more internal storage and RAM, faster quick charging, One UI and its true multi tasking (having 2 apps open at once) and the amount of customisation will always beat IOS for me. I mean they just about got a video editior in IOS 13 and Samsung has had this for over 4 or 5 years. Lets not get started on how easy it is drag and dropping songs, videos and images onto a Samsung device and not having to use the mess that is Itunes. You look at 1 persons iDevice it looks the same as everyone else, same icon's, same ringtones very boring and stale. 1 Samsung device compared to another will look VERY different due to what One UI lets you do.

27. JCASS889 unregistered

This guy gets it

2. cmdacos

Posts: 4393; Member since: Nov 01, 2016

The Cook and Trump dating has really paid off for Apple. They're a match made in heaven.

5. Alcyone

Posts: 619; Member since: May 10, 2018

*opinion* Bluff pays off. I highly doubt they ever planned to follow through on the second round of tariffs. However, either way Appld would've been exempt. Cooks siren song paid off; hook, line and sinker.

7. Nokfan1603

Posts: 75; Member since: Mar 13, 2013

Trump is incredible. In October he said he has a deal and that the farmers can start buying more farming equipment. At the end of August he tweeted that a deal was very close only to raise tariffs four days later. This time again he tweets that a deal is very close. I will believe it, once a deal is truly signed. And if there is really a deal and the Chinese will buy more soybeans again then one will have to ask if it was really worth it. The Chinese do not seem to surrender on Trump's most important demands and there probably won't be a phase two, three, four...

13. darkkjedii

Posts: 31772; Member since: Feb 05, 2011

So basically, the orange idiot realized the major negative impact his decision was gonna have, and reluctantly change his mind.

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