If newly elected President Donald Trump follows through with sweeping new tariffs on everything made in China, your next iPhone could cost about $300 more, economists estimate.
If you like Samsung phones, the price increase probably doesn’t apply.
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Americans buy about 130 million new smartphones every year, mostly Apple or Samsung devices, making them one of the most purchased technology products.
The potentially higher prices for iPhones show how policy decisions in Washington can affect you — and how confusing and arbitrary they can be.
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How iPhones Skipped Trump Tariffs the First Time
First, a quick reminder: a tariff is a tax on products that cross borders.
For a simplified example, when Walmart imports bicycles made in Chinese factories into the United States, Walmart (or typically an importer hired by Walmart) pays a tariff to the U.S. government.
To pay that tax, Walmart might have to pay less to the Chinese factory for those bikes, absorb the cost of that tax itself, raise the price for that bike in its stores, or some combination of the three.
Trump and some conservative economists say tariffs won’t raise prices. But economists almost universally say that shoppers will ultimately pay more for a bicycle as a result of the tariff.
However, during the first Trump administration, Apple CEO Tim Cook helped convince the White House to impose tariffs on most of the products the company sells. That included iPhones, the vast majority of which are made in China.
Cook reportedly told White House officials at the time that tariffs would raise prices on smartphones, computers and tablets and hurt Apple. The White House seemed to agree. President Joe Biden’s administration has largely kept in place the Trump administration’s tariffs.
So while bicycles, luggage and washing machines imported from China were subject to higher tariffs, iPhones, Mac computers and iPads assembled in Chinese factories were not.
“Consumer electronics has been absolutely privileged,” said Mary E. Lovely, an economist at the Peterson Institute for International Economics, under U.S. tariff policies in the Trump and Biden administrations. “That shows the Tim Cook effect.”
No one knows what the Trump 2.0 administration will do. But as a candidate, Trump discussed a 10 to 20 percent tariff on goods imported from anywhere, and a 60 percent or higher tariff on anything from China.
Calculating that tax isn’t easy, but several trade experts said the tariff rate, if applied to Apple products, could impose a tax of about $300 on a $1,000 iPhone. Some of that higher tax would likely be reflected in the price you pay for iPhones.
