Apple CFO warns Trump border tax could 'burden' consumers
Apple CFO Luca Maestri warned that a "border tax" on imports could hurt American consumers and stall the economy.
It is "very hard for us to imagine that a border tax would be good for the US economy, because it would burden the consumer and the dollar would appreciate versus where it is today, which is already too strong," he told an audience of investors at the Goldman Sachs Technology and Internet Conference in San Francisco on Tuesday. "It doesn't yield a positive outcome."
President Trump and his team have floated various tariff plans since his election, such as a 35% tax on German cars imported into the U.S., and a 20% tax on Mexican imports to help pay for a border wall.
Republicans in Congress have also floated the idea of a more general border adjustment tax, which would eliminate taxes on U.S. exports and add a blanket tariff on all imports.
No formal bill has been introduced, and any actual taxes may be much lower than originally proposed.
Supporters believe these tariffs would encourage companies to manufacture more products in the U.S., leading to more high-paying factory jobs. But critics like Maestri have pointed out that the tax would raise prices for consumers, slowing consumption and decreasing demand.
Apple has a particular interest in the subject because most of its products, including the iPhone, which accounts for over half its sales and profits, are manufactured outside the U.S. and may be subject to any passed tariffs.
Maestri noted that even if Apple assembled more of its products in the U.S., huge parts of the supply chain are located overseas. It would be extremely costly for Apple and all its suppliers to relocate the bulk of their manufacturing to the U.S.
He said that Apple has created more than "2 million jobs" over the last 10 years including positions in its retail stories, at its suppliers, and among developers who build apps for its products.
See also: Apple explains why its R&D spending is on the rise
