Trump says US will levy 100% tariff on some chip imports

Time of India

4 days ago

The United States will impose a tariff of about 100% on semiconductor chips imported from countries not producing in America or planning to do so, President Donald Trump said.
Trump told reporters in the Oval Office on Wednesday the new tariff rate would apply to "all chips and semiconductors coming into the United States," but would not apply to companies that had made a commitment to manufacture in the United States or were in the process of doing so.
Productivity Tool
Zero to Hero in Microsoft Excel: Complete Excel guide
By Metla Sudha Sekhar
View Program
Finance
Introduction to Technical Analysis & Candlestick Theory
By Dinesh Nagpal
View Program
Finance
Financial Literacy i e Lets Crack the Billionaire Code
By CA Rahul Gupta
View Program
Digital Marketing
Digital Marketing Masterclass by Neil Patel
By Neil Patel
View Program
Finance
Technical Analysis Demystified- A Complete Guide to Trading
By Kunal Patel
View Program
Productivity Tool
Excel Essentials to Expert: Your Complete Guide
By Study at home
View Program
Artificial Intelligence
AI For Business Professionals Batch 2
By Ansh Mehra
View Program
"If, for some reason, you say you're building and you don't build, then we go back and we add it up, it accumulates, and we charge you at a later date, you have to pay, and that's a guarantee," Trump added.
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
No annual fees for life
UnionBank Credit Card
Apply Now
Undo
The comments were not a formal tariff announcement, and Trump offered no further specifics.
It is not clear how many chips, or from which country, would be impacted by the new levy. Taiwanese chip contract manufacturer TSMC - which makes chips for most U.S. companies - has factories in the country, so its big customers such as
Nvidia
are not likely to face increased tariff costs.
Live Events
The AI chip giant has itself said it plans to invest hundreds of billions of dollars in U.S.-made chips and electronics over the next four years. An Nvidia spokesperson declined to comment for this story.
"Large, cash-rich companies that can afford to build in America will be the ones to benefit the most. It's survival of the biggest," said Brian Jacobsen, chief economist at investment advisory firm Annex Wealth Management.
Congress created a $52.7 billion semiconductor manufacturing and research subsidy program in 2022. The Commerce Department under President Joe Biden last year convinced all five leading-edge semiconductor firms to locate chip factories in the U.S. as part of the program.
The department said the U.S. last year produced about 12% of semiconductor chips globally, down from 40% in 1990.
Any chip tariffs would likely target China, with whom Washington is still negotiating a trade deal.
"There's so much serious investment in the United States in chip production that much of the sector will be exempt," said Martin Chorzempa, senior fellow at the Peterson Institute for International Economics.
Since chips made in China won't be exempt, chips made by SMIC or Huawei would not be either, Chorzempa said, noting that chips from these companies entering the U.S. market were mostly incorporated into devices assembled in China.
"If these tariffs were applied without a component tariff, it might not make much difference," he said.
Chipmaking nations South Korea and Japan, as well as the European Union, have reached trade deals with the U.S., potentially giving them an advantage.
The EU said it agreed to a single 15% tariff rate for the vast majority of EU exports, including cars, chips and pharmaceuticals. South Korea and Japan said separately that U.S. agreed not to give them worse tariff rates than other countries on chips, suggesting a 15% levy as well.