Updates for extra taxes for Companies that Produces Overseas
The United States’ President plans to impose new taxes on US firms which manufacture their goods abroad, such as Apple. Taxation is an incentive, as for Donald Trump, they have to transfer their production home if the companies wouldn’t want to pay extra.
This is yet another attempt to shift production from China, according to US Trump officials. When asked if he’s going to give tax break to some firms, he cleared that it is what companies would do for their country.
According to the Department of Commerce, US businesses have lost $46 billion since Donald Trump had begun enforcing Chinese import tariffs. The trade war between the US and China is likely to have caused Chinese $370 billion worth of import.
During the rally for re-election, Trump referred to supply chain as stupid, as reported by Reuters and their weakness have been shown by covid 19 outbreak as the main products are being cut off. The President said that supply chains should not exist and that all manufacturing should relocate to the United States.
When introduced, the question is whether this measure would raise the price of iPhones currently produced by Foxconn in two main plants in China.
It is extremely unlikely that even a tax break will equally amount the rise in cost of labor. The problem then emerges whether the United States government wants to go forward with its strategy as far as we can expect.