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Apple gets import tax exemption after trade "truce" between …

by ace
Apple gets import tax exemption after trade "truce" between ...

Apple has managed to get a 15% cut in Chinese import duties on products like the iPhone, iPad and MacBooks. The tariffs that would take effect on December 15 would, for example, cause the value of Apple's smartphone to rise by $ 150.

The decision comes after the signing of the first phase of a trade "truce" between China and the United States, advances to Bloomberg. According to Dan Ives of Wedbush Securities, the deal was a kind of Donald Trump's "Christmas gift" for Apple as it managed to prevent a sharp drop in demand for equipment at such a crucial time as Christmas. The analyst says that if the Cupertino giant raised the price of the iPhone, demand would fall by 6% by 2020.

In November, Apple again applied to the United States Trade Policy Agency, the Federal Trade Commission, for a 15% fee waiver on 11 of its products, including AirPods, components used to repair iPhones and iMac computers. In the exclusion request, the company indicated that it was unable to find manufacturers outside China that would be able to meet US demand for its products.

In recent years, China has been Apple's main production base, not only because it has managed to recruit hundreds of thousands of skilled workers to respond to rapidly growing demands, but also because of the complex component and logistics ecosystem that was generated around these production sites.

In June this year, Apple planned to shift between 15% and 30% of its production outside of China. The company considered it too risky to depend so much on Chinese production and compounded its concerns about the growing tension between Washington and Beijing. However, as the technology giant is not being able to relocate production of its products outside China, its CEO Tim Cook has put pressure on the US government to protect its products.

In September this year, US regulators approved 10 of 15 requests for Apple's required fee exemptions. However, the company was unable to escape the 25% rates on five of the new Mac Pro's components. The exclusion was denied, as the applications failed to demonstrate how imposing import taxes would have serious negative economic consequences.


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