Amid uncertainty over rising costs due to steep tariffs, the White House announced an exception for imported smartphones, laptops, chips, and other electronics. This temporary exemption would have significant implications for the US economy, which has experienced highs and lows since the announcement of new tariffs.

Merely a delay 

The Trump administration previously imposed tariffs of up to 145% on imported goods from China and a minimum 10% global tariff on nearly all other countries. While the tariff on China has yet to be enacted, US consumers were riddled with concerns about price hikes, which translated into a crashing stock market and panic buying of electronics.

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The exemption is temporary and intended to pause tariffs on imported electronics, including smartphones, laptops, CPUs, memory chips, and potentially some semiconductor manufacturing equipment. Other electronics included in the exemptions are solar cells, flash drives, tablets, memory cards, and flat-panel TVs.

However, Commerce Secretary Howard Lutnick confirmed that this is merely a delay -- not a way to clear the tech industry of tariffs altogether.

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"All those products are going to come under semiconductors, and they're going to have a special focus type of tariff to make sure that those products get reshored. We need to have semiconductors, we need to have chips, and we need to have flat panels -- we need to have these things made in America. We can't be reliant on Southeast Asia for all of the things that operate for us," Lutnick said in an interview on ABC News' This Week.

Subject to other tariffs

He added that electronics covered under Friday's exemption will be subject to semiconductor-related tariffs that will be enacted in the next one or two months. These semiconductor tariffs will include not just raw chips but also products containing chips, like smartphones, laptops, and flat panels.

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Other consumer tech products, such as computer accessories, earbuds, gaming consoles, and lithium-ion batteries, are excluded from the initial exemption and remain subject to tariffs.

However, President Donald Trump contradicted the "exemption" narrative on social media, writing, "There was no Tariff 'exception' announced on Friday. These products are subject to the existing 20% Fentanyl Tariffs, and they are just moving to a different Tariff 'bucket,'" in a post on Truth Social on Sunday. "We are taking a look at Semiconductors and the WHOLE ELECTRONICS SUPPLY CHAIN in the upcoming National Security Tariff Investigations."

Taking a hit

As retailers adjust to the added costs of tariffs, consumers could see higher prices on imported goods.

The strategy behind the tariff is to encourage tech manufacturing in the US, and the White House has claimed in its announcements that tech companies are scurrying to onshore production. But companies like Apple are already taking a hit after the tariff announcements, having lost over$640 billion in market value over the past week.

Companies may reduce imports of products subject to tariffs, leading to potential shortages and increased prices. This could influence buyers to delay purchases or seek alternative products.

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"President Trump has made it clear America cannot rely on China to manufacture critical technologies such as semiconductors, chips, smartphones, and laptops," Karoline Leavitt, White House press secretary, said in a statement last Saturday. "That's why the President has secured trillions of dollars in US investments from the largest tech companies in the world, including Apple, (Taiwan Semiconductor Manufacturing Company), and Nvidia."

Made in the USA

Some reports say an iPhone that is completely "Made in the USA" could cost as much as$3,500, up from its current$1,200.

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Shifting manufacturing entirely to the US is not immediately possible for the main tech companies. While Apple and Nvidia are temporarily getting relief from tariffs on some imported goods, sources say it would take decades and billions of dollars just to move 10% of Apple's supply chain to the US.

Also: Are tariffs about to make your next iPhone way more expensive? It's complicated

Apple still assembles 90% of its iPhones in China, but the company has diversified its supply chain to make iPhones in India, assemble Macs in Malaysia, and source components from Vietnam. These countries are all facing new tariffs.

The latest exemption would also cover Taiwanese and Mexican production, where companies like Nvidia manufacture and assemble components.

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