The Trump administration has revealed plans to implement tariffs on chips made in Taiwan in an attempt to bolster domestic production.
Trump Says That The CHIPS Act Gave Companies "Billions Of Dollars" Without Any Benefit, Says Tariffs Would Bring Production Back In US
The debate around whether Donald Trump would impose tariffs on chip production in Taiwan might have just ended, as the new US president has announced his intentions to tax semiconductors from foreign lands. In the recent House Republican conference, Trump claimed that his tariff policy on chips would ensure that the core technology remains in the US, and companies like TSMC would be forced to set up facilities in the US rather than somewhere else.
In particular, in the very near future, we’re going to be placing tariffs on foreign production of computer chips, semiconductors and pharmaceuticals to return production of these essential goods to the United States. They left us and went to Taiwan.
We want them to come back. And we don’t want to give them billions of dollars like this ridiculous program that Biden has given everybody billions of dollars. They already have billions of dollars. They’ve got nothing but money Joe. They didn’t need money.
They needed an incentive. And the incentive is gonna be they’re not gonna wanna pay a 25, 50 or even a 100 % tax.
- Trump via X
This is certainly a move many of us were expecting when Trump was coming into power, mainly since he has passed out remarks claiming the CHIPS Act to be a "flawed move" by the Biden administration, with no real incentive to the US semiconductor markets, instead a money distribution scheme. Trump implied that companies like TSMC have chosen a nation other than the US for production and that, because of this move, they should be penalized in the form of aggressive tariffs.
While Trump hasn't explicitly outlined his plans on how the administration will tax firms like TSMC, he did say that the tariffs could reach up to 100%, which is shocking and devasting for the semiconductor and consumer technology markets. Given that chips from TSMC play a massive part in every mainstream device, taxation on them will drive prices even higher, making the products way more expensive, hindering the growth of the US consumer markets. The already costly processes, such as TSMC's 3nm, could be out of reach for many companies if these tariffs hit the markets.
Of course, with the advent of the CHIPS Act, we have seen many firms setting up facilities in the US, with TSMC leading with their Arizona fab, which is said to have started production for the 4nm process. The Taiwan giant has expressed its commitment to the US semiconductor industry and plans to expand up to 2nm this decade, showing that TSMC isn't entirely prioritizing Taiwan. While the US's core focus is on ensuring domestic production, whether the tariff policy would lead towards the goal remains a mystery.
About the author: Muhammad Zuhair is a hardware and technology reporter for Wccftech, specializing in the semiconductor industry and the complex interplay between technology, manufacturing, and geopolitics. His coverage focuses on the corporate strategies and technological roadmaps of industry giants like TSMC, NVIDIA, Samsung, and Intel. Zuhair's expertise lies in deconstructing complex topics such as fabrication nodes (e.g., 2nm process), the economic impact of policies like the CHIPS Act, and the strategic development of AI infrastructure from NVIDIA, AMD and Intel.
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