Tue, Sep 11, 2018 - Page 10 News List

Apple can avoid tariffs by producing in US: Trump

‘INCENTIVE’:Tariffs on Chinese products that Apple uses in its gadgets would raise the cost of the firm’s US operations and put it at a disadvantage to foreign rivals

AP

US President Donald Trump conceded that some Apple Inc products might become more expensive if his administration imposes “massive” additional tariffs on Chinese-made goods, but said the tech company can fix the problem by moving production to the US.

“Start building new plants now. Exciting!” Trump said on Saturday in a tweet aimed at the Cupertino, California-based company.

Apple last week said that a proposed new round of US$200 billion in additional tariffs on Chinese imports would raise prices on some of its products, including the Apple Watch and the Mac mini.

The company is highly exposed to a trade war between the US and China. It makes many of its products for the US market in China, and it also sells gadgets, including the iPhone, in China, making them a potential target for Chinese retaliation against the Trump tariffs.

Trump on Saturday tweeted that “Apple prices may increase because of the massive Tariffs we may be imposing on China _ but there is an easy solution where there would be ZERO tax, and indeed a tax incentive,” if the company made its products in the US instead of China.

Apple did not immediately respond to a request for comment. The company has not announced plans to move manufacturing from China to the US.

In its letter last week to the Office of the US Trade Representative, Apple said that “because all tariffs ultimately show up as a tax on US consumers, they will increase the cost of Apple products that our customers have come to rely on in their daily lives.”

The company said tariffs would hit “a wide range of Apple products,” including computers, watches, adapters, chargers and tools used in its US manufacturing, repair and data centers.

Apple said the tariffs would raise the cost of its US operations and put it at a disadvantage to foreign rivals.

The White House has accused China of stealing US intellectual property and forcing US companies to share their technology with Chinese companies.

The tariffs would pressure China to stop that behavior, the US administration has said.

Apple said “it is difficult to see” how tariffs would advance the US government’s goal.

The presidential tweet is the latest salvo in a dispute between the Trump administration and US companies that fear tariffs will hurt their business.

The Trump administration has imposed tariffs of US$50 billion on imports from China, mostly equipment and material used by manufacturers.

Apple chief executive officer Tim Cook in July said that those measures had no effect on Apple.

However, the company is concerned about the Trump administration’s proposal to add 25 percent duties on another US$200 billion in Chinese goods, including a wider assortment of consumer-related items.

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