Comment on Trump says he plans to put a 100% tariff on computer chips, likely pushing up cost of electronics
SaltSong@startrek.website 3 weeks agoWhat he means is, if I buy an iPhone built in China, this tariff won’t affect the price I pay.
But if I buy a phone built in America, with an imported processer, this tariff will make that phone more expensive.
artyom@piefed.social 3 weeks ago
Not correct. Once again, tariffs only affect imported goods. If you buy an iPhone built in China (assuming you import to the US) you're going to pay a tariff on the device.
If you buy a phone built in America, with Chinese processors, you only pay tariff on the processor.
Wispy2891@lemmy.world 3 weeks ago
He meant that this is a disincentive to manufacture a phone in the USA.
Phone built in china: 30% tariff on the total assembled unit (this week is 30% or it changed again?)
Phone built in USA: 30% tariff on all the components because they’re made in China, 100% tariff on the processor, AND spend 1000% more in assembling the device because finding, training and paying skilled workers is way more expensive
Maybe there might be an incentive to move production to a country different from China, but the situation changes too wildly. The risk of spend millions to move production to Vietnam to get a lower rate, then a week later Trump gets diarrhea from eating a bahn mi and imposes an immediate 50% tariff as revenge
artyom@piefed.social 3 weeks ago
What? Are you putting American chips in these phones made in China? Why would you think they wouldn't be subjected to the chip tariff?
BeardedGingerWonder@feddit.uk 3 weeks ago
The question comes down to whether a phone with a chip in it is subject to the tariff or just raw chips being imported. No one is putting a US chip in it, because US chips don’t exist. The foundries to make them don’t exist.
If the assembled phone is subject to a “phone” or “general” tariff at 30% and not the 100% chip tariff then it incentivises manufacturing in china vs the US is what I think the OP is saying.
Wispy2891@lemmy.world 3 weeks ago
there’s a youtube video from “smarter every day” that showed his attempt to make something 100% in the USA.
The item was just a barbecue scrubber, with just a few components.
He needed a simple screw… NOBODY made that in the US…
He needed a simple plastic knob… NOBODY made that in the US (he bought 10k “american” knobs but once arrived there was a MADE IN COSTA RICA sign)
He wanted to make injection molds in the US… NOBODY did that, he had to find some retired expert to help him.
So, if you assemble stuff in US, you still need to import EVERYTHING, paying the same tariff and with more expensive labor. Tariffs need to be carefully considered and target a specific item in order to have some positive effect
SaltSong@startrek.website 3 weeks ago
Right, but this tariff, at least as I understand it, is on chips imported as chips, not on products that contain chips. An iPhone will, of course, be subject to some other damn fool tariff, but not this specific one.
Of course, my understanding of this specific tariff may be wrong.
artyom@piefed.social 3 weeks ago
Where do you see that?
SaltSong@startrek.website 3 weeks ago
That’s generally how tariffs work. A tariff on grain is not a tariff on bread. A tariff on steel is not a tariff on knives. A tariff on cotton is not a tariff on clothing.
It can be, of course. A tariff can be on steel and items made with steel. But that’s not usually the case, and it’s usually called out as such. Of course, Trump is not what you’d call the most precise communicator in the world, but all we can do is work with what he says.