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Apple Watch, Bluetooth gadgets will be excluded from U.S.’s China tariffs

Click to play video: 'Donald Trump charging ahead with tariffs on $200 billion of Chinese imports, reports say' Donald Trump charging ahead with tariffs on $200 billion of Chinese imports, reports say
WATCH: Donald Trump charging ahead with tariffs on $200 billion of Chinese imports, reports say – Sep 16, 2018

The United States will spare Apple Watch and other consumer gadgets from the latest round of tariffs on Chinese goods, a senior administration official said in a last-minute reprieve for the technology industry on Monday.

READ MORE: Donald Trump charging ahead with tariffs on $200 billion of Chinese imports: reports

The administration’s proposal for the tariffs on $200 billion of products drew protest from technology companies earlier this year, but the final list of taxed devices described by the official avoids many big consumer brand names and products.

It will take effect on Sept. 24 at a 10 per cent level and rise to 25 per cent at the end of the year, the person said.

Smartwatches and devices that use Bluetooth wireless communications, the technology behind Apple’s AirPods and other products that work with smartphones, will be excluded from the new tariff list.

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In an earlier round of tariffs on $50 billion of goods, the Trump administration removed proposals on flat-panel television sets for the final list in June.

The new list would spare fitness trackers from Fitbit Inc., which had said in a comment letter to regulators that the tariffs would compromise its own investment in the United States.

However, some products that help computer networks operate, such as routers, will remain on the new list, the official said. That could affect smaller technology firms such as Eero, a startup company that makes home routers and had asked to be exempted from the tariffs. Altogether about 300 product categories were given reprieves, including some non-tech consumer devices such as bicycle helmets and baby car seats.

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READ MORE: Fact check: Is Trump claiming victory too soon on tariffs against China and Canada?

Despite the changes, the new tariffs still will cover about $200 billion worth of additional Chinese goods, as part of an intensifying trade dispute between the world’s two largest economies.

Apple and Eero did not respond to a Reuters request for comment, and Fitbit declined to comment. Apple Chief Executive Tim Cook had dinner with U.S. President Donald Trump last month, though neither gave details of discussions.

Apple had said the U.S. tariffs would affect prices for a “wide range” of Apple products, including its Watch, in a letter commenting on administration proposals earlier this month.

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Trump ups ante by threatening tariffs on nearly all China’s U.S. imports – Sep 8, 2018

“Our concern with these tariffs is that the U.S. will be hardest hit, and that will result in lower U.S. growth and competitiveness and higher prices for U.S. consumers,” Apple said in a letter commenting on the proposal.

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After Apple’s comments, Trump said in a tweet said that there was an “easy solution” for Apple to avoid tariffs. “Make your products in the United States instead of China. Start building new plants now,” he tweeted on Sept. 8.

Bloomberg reported earlier on Monday that Apple Watches would not face tariffs in the new round.

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