U.S. Proposes 100% Tariff on Imported Semiconductors
U.S. President Donald Trump announced on August 6 that the United States would impose a 100% tariff on imported semiconductors, marking a significant escalation in his administration’s protectionist policies. This move aims to encourage domestic manufacturing and secure the country’s supply chain for critical technology.
During a press conference at the Oval Office, Trump emphasized that companies investing in or planning to build manufacturing operations within the U.S. would be exempt from the tariff. “We’re going to be putting a very large tariff on chips and semiconductors,” he stated, while flanked by Apple Inc. CEO Tim Cook. “But the good news for companies like Apple is, if you’re building in the United States—or have committed, without question, to build in the United States—there will be no charge.”
Trump reiterated this point, highlighting that even if a company has not yet started production, it would still qualify for an exemption if it had made a commitment to build in the U.S. “That’s a big statement, and I think the chip companies are all coming back home,” he added.
The announcement coincided with Apple’s unveiling of a $100 billion expansion plan for its U.S. manufacturing operations. This investment brings Apple’s total domestic commitment to $600 billion over the next four years. The new initiative is part of the American Manufacturing Program (AMP), which focuses on strengthening domestic supply chains and advancing high-tech production. AMP partners include Corning Inc., Texas Instruments Inc., and Applied Materials Inc.
Although Trump did not specify when the semiconductor tariff would take effect, the measure would align with a broader set of reciprocal tariffs scheduled to be imposed on many trading partners starting at 12:01 a.m. Eastern Time on August 7. So far, electronics such as smartphones, computers, and monitors have been excluded, but Trump hinted that they could be included in a separate action targeting products containing semiconductors.
The policy is being pursued under Section 232 of the Trade Expansion Act, a Cold War-era statute that allows the president to impose tariffs on imports deemed to threaten national security. The current investigation, launched earlier this year, covers a range of foreign-made chips and electronic devices.
If enacted, the tariffs would mark the first time that semiconductors are subjected to duties since the 1997 World Trade Organization Information Technology Agreement (ITA), which committed signatory nations—including the U.S. and South Korea—to tariff-free trade in IT goods.
The proposed measure could significantly impact South Korean chipmakers, which exported $10.68 billion worth of semiconductors to the U.S. last year, making it Korea’s third-largest export category to the American market. While Seoul has secured “most-favored nation” treatment for semiconductors in a recent trade agreement with Washington, it remains unclear what tariff rates—should any—Korean exporters will face under the new framework.
Industry leaders such as Samsung Electronics Co. and SK Hynix Inc. now face the challenge of recalibrating their U.S. strategies, as the administration’s tariff shift disrupts long-standing assumptions of duty-free trade under the global IT regime. This development signals a major shift in U.S. trade policy and raises questions about the future of international semiconductor trade.
