XR Devices May Be Included in Tariff Exemption List Under “Reciprocal Tariff”Policy

Recently, the Trump administration introduced a new “Reciprocal Tariff” policy that

imposes a minimum baseline tariff of 10% on all U.S. trading partners, with

significantly higher rates applied to dozens of countries, including China. In response,

China announced its own retaliatory tariff measures.

While there had been widespread industry concern that the new tariffs could drive up

prices for XR headsets and similar devices, recent developments suggest that XR

products may be eligible for inclusion on the exemption list under the Reciprocal

Tariff framework.

It is common for countries imposing new tariffs to establish product exclusion

mechanisms. Just one day after announcing the new global tariff policy, the Trump

administration released a 22-page product exemption list, which included a key

clause: the “≥20% U.S. content” rule. Under this provision, if a product—regardless of

country of origin—contains 20% or more U.S.-made components (based on its

declared customs value), only the non-U.S. content will be subject to the reciprocal

tariff; the U.S. content will be exempt.

According to most analysts, this rule is expected to benefit sectors such as consumer

electronics (including smartphones, high-end AV devices, and AR/VR headsets),

telecommunications equipment (such as optical modules, servers, and 5G base

station controllers), and industrial automation (including robotics and medical imaging

systems).

However, He Hui, Research Director for the Semiconductor Sector at Omdia, noted:

“Companies that meet the exemption criteria can reduce tariff-related costs—for

example, those in the iPhone supply chain. But lower-end electronics, such as

chargers and basic headphones, which do not meet the content threshold, may still

face tariffs as high as 46%, potentially leading to a 20%–30% increase in retail

prices.”