The Trump administration will delay until mid-December the 10% tariff on some Chinese products on many holiday-shopping lists.
By granting a grace period for everyday items like some phones and toys, the U.S. concession appears designed to avoid any disruption or additional price increases for American consumers heading into the final four months of the year -- from back-to-school purchases to Christmas shopping.
The announcement also came as the two sides spoke for the first time since the recent escalation in tensions.
Stocks surged on the news Tuesday. Apple Inc. spiked 4.7% and Best Buy Co. climbed 8% on optimism that the reprieve would boost electronics sales in the holiday season. Apparel retailers including Gap Inc. and L Brands Inc. rose, as did toy maker Hasbro Inc. and discount chain Dollar Tree Inc.
The U.S. Trade Representative’s office said in a statement Tuesday that tariffs would be delayed until Dec. 15 for items such as cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing.
“What this means is that retailers will be able to get their shipments in without the 10% tariff, which is a sigh of relief,” said Poonam Goyal, a retail analyst at Bloomberg Intelligence. “It definitely saves the holiday season.”
With the Sept. 1 deadline, there wasn’t time for retailers to speed up ordering for the holiday season because it often takes more than four weeks for inventory to come from China, Goyal said.
While some tariffs will take effect on Sept. 1 as planned, “certain products are being removed from the tariff list based on health, safety, national security and other factors,” the USTR also said.
About $250 billion of Chinese goods have already been hit by 25% duties.
David French, a spokesman for the National Retail Federation, said the organization was pleased by the delay on certain consumer goods but expressed caution.