Trump plans 100% tariff on pc chips, except firms construct in U.S.
U.S. President Donald Trump stated on Wednesday that he’ll impose a 100% tariff on pc chips, elevating the spectre of upper costs for electronics, autos, family home equipment and different important merchandise depending on the processors powering the digital age.
“We can be placing a tariff of roughly 100% on chips and semiconductors,” Mr. Trump stated within the Oval Workplace whereas assembly with Apple CEO Tim Cook dinner. “However if you’re constructing in america of America, there is no such thing as a cost.”
The announcement got here greater than three months after Mr. Trump briefly exempted most electronics from his administration’s most onerous tariffs.
The Republican president stated firms that make pc chips within the U.S. can be spared the import tax. Through the COVID-19 pandemic, a scarcity of pc chips elevated the worth of autos and contributed to increased inflation.
Traders appeared to interpret the potential tariff exemptions as a constructive for Apple and different main tech firms which have been making big monetary commitments to fabricate extra chips and different parts within the U.S.
Large Tech already has made collective commitments to take a position about USD 1.5 trillion within the US since Mr. Trump moved again into the White Home in January. That determine features a USD 600 billion promise from Apple after the iPhone maker boosted its dedication by tacking one other USD 100 billion on to a earlier dedication made in February.
Now the query is whether or not the deal brokered between Mr. Cook dinner and Mr. Trump can be sufficient to insulate the thousands and thousands of iPhones made in China and India from the tariffs that the administration has already imposed and scale back the stress on the corporate to boost costs on the brand new fashions anticipated to be unveiled subsequent month.
Wall Avenue actually appears to suppose so. After Apple’s inventory worth gained 5% in Wednesday common buying and selling periods, the shares rose by one other 3% in prolonged buying and selling after Mr. Trump introduced some tech firms is not going to be hit with the most recent tariffs whereas Mr. Cook dinner stood alongside him.
The shares of AI chipmaker Nvidia, which additionally has just lately made large commitments to the U.S., rose barely in prolonged buying and selling so as to add to the USD 1 trillion acquire in market worth the Silicon Valley firm has made for the reason that begin of Mr. Trump’s second administration.
The inventory worth of pc chip pioneer Intel, which has fallen on arduous instances, additionally climbed in prolonged buying and selling.
Inquiries despatched to chip makers Nvidia and Intel weren’t instantly answered. The chip business’s fundamental commerce group, the Semiconductor Business Affiliation, declined to touch upon Mr. Trump’s newest tariffs.
Demand for pc chips has been climbing worldwide, with gross sales rising 19.6% within the year-ended in June, in accordance with the World Semiconductor Commerce Statistics organisation.
Mr. Trump’s tariff threats mark a big break from current plans to revive pc chip manufacturing within the U.S. that have been drawn up in the course of the administration of President Joe Biden.
Since taking up from Mr. Biden, Mr. Trump has been deploying tariffs to incentivise extra home manufacturing. Basically, the president is betting that the specter of dramatically-higher chip prices would pressure most firms to open factories domestically, regardless of the danger that tariffs may squeeze company earnings and push up costs for cellphones, TVs and fridges.
Against this, the bipartisan CHIPS and Science Act that Mr. Biden signed into regulation in 2022 supplied greater than USD 50 billion to help new pc chip crops, fund analysis and prepare staff for the business. The combination of funding help, tax credit and different monetary incentives have been meant to attract in personal funding, a method that Mr. Trump has vocally opposed.
Revealed – August 07, 2025 09:03 am IST
