Apple Denied Tariff Exemptions on Five Mac Pro Components

BY Rajesh Pandey

Published 1 Oct 2019

Despite Apple making its upcoming 2019 Mac Pro in the United States, the U.S. government has denied the company’s requests for tariff exemption on five Chinese made components. Apple will have to pay 25% tariff on these components.

The components include the optional wheels for the Mac Pro chassis, power adapter, charging cable, cooling system for the processor, and a circuit board for managing the I/O ports.

In letters to Apple posted online, USTR said the five exclusion requests were denied because they “failed to show that the imposition of additional duties on the particular product would cause severe economic harm to you or other U.S. interests.”

Apple is still getting a tariff relief from the U.S. government on making the Mac Pro in India. The other components that have been granted a tariff relief include the Mac Pro’s chassis, the mouse, keyboard, and more. In total, Apple had requested tariff exemption for 15 components, out of which the U.S. government has approved 10 of them.

The decision to not charge a tariff on a product depends on a number of reasons like whether the product is exclusively manufactured in China, whether the duties will “cause severe economic harm” to the company or the U.S., and more. Apple had mentioned in its request for the tariff waiver that it does not have any other source for the proprietary, Apple-designed components.

While the Mac Pro has been granted a tariff exemption, other Apple products like the Apple Watch, AirPods, and iMacs are already attracting a 15% tariff. Other major money-making Apple products like the iPhone and iPads will also be subject to a tariff from December. Apple absorbed the tariff hit for the Apple Watch and AirPods and it is expected to do the same for iPhones and iPads. The company does have a vast supply-chain that will allow it to meet the U.S. demand for the iPhones from factories located outside of China.

[Via Bloomberg]