Lutnick Says Exempted Electronic Products Will Face Separate Tariffs

Commerce Secretary Howard Lutnick said on April 13 that some electronics, including smartphones and computers, will fall under separate tariff plans that include semiconductors, which may be announced in a month or so.

Lutnick told ABC’s Jonathan Karl that Trump’s announcement on Friday only exempted those items from reciprocal tariffs.

“But they’re included in the semiconductor tariffs, which are coming in probably a month or two,” Lutnick said.

After Trump’s early April announcement of universal 10 percent tariffs on every U.S. trade partner, along with separate reciprocal tariffs for some, global and domestic stock markets underwent some turbulence. The president then paused almost all his tariffs for 90 days after declaring that he is brokering trade deals with numerous partners, while raising tariffs on Chinese imports to 145 percent.

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After initially dropping on the April 2 tariff plan unveiling, the S&P 500 rose 9.5 percent—its highest single-gain day since October 2008—on Wednesday after Trump announced his 90-day pause on most tariffs. Its index, however, was still down 11.2 percent below a recent high in February.

While many of the president’s tariffs are open to negotiation, Lutnick emphasized that semiconductor-based technology products were exempted on Friday precisely because they’re non-negotiable.

“So this is not a permanent sort of exemption,” he said. “[Trump is] just clarifying that these are not available to be negotiated away by countries.”

Lutnick said tariffs on semiconductors and pharmaceuticals are necessary to encourage their production back to America.

“We need our medicines, and we need semiconductors and our electronics to be built in America,” he said.

“We can’t be beholden and rely upon foreign countries for fundamental things that we need. We can’t be relying on China for fundamental things that we need.”

Biden cited the need to relieve America’s reliance on China for sourcing semiconductors, which are essential to a wide range of consumer electronics, while also supporting U.S. jobs.

Lutnick echoed those concerns on Sunday.

“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,” he said. “Virtually all semiconductors are made now in Taiwan, and they’re finished in China.”

Karl, noting that it would be unlikely that Apple opens a factory “tomorrow to build iPhones” in America, asked Lutnick if the new tariffs will lead to higher prices, as some companies, such as AutoZone and Amazon, have already publicly indicated.

“I don’t necessarily think so. I think the idea is that we can manufacture here in America,” Lutnick said, adding that Panasonic had just finished building a new factory in Kansas.

“They made deals with the community colleges nearby and all the local community,” he said. “They trained people for this—4,000 high-tech jobs in Kansas.

“That is what’s coming back to America. You’re going to see that production, that that kind of high-tech factor is going to produce things here at very reasonable prices.”

Sen. Elizabeth Warren (D-Mass.), who spoke with Karl after Lutnick, said she wants Congress to be able to approve or block tariffs imposed by the president.

“Every Democrat is ready to go, to push back or take away from the president the power he’s now exercising. The question is whether or not the Republicans will join us in this. There will be a vote in about 15 days,” Warren told Lutnick on Sunday.

Naveen Athrappully contributed to this report.