Trump Proposes 100% Tariff on Imported Semiconductors, Exempts U.S.-Based Manufacturers

President Donald Trump announced on Wednesday a proposed 100 percent tariff on imported semiconductors, part of a broader push to bring advanced manufacturing back to the United States. However, the steep levy will not apply to companies that are either already producing chips domestically or have committed to building U.S.-based facilities.

The announcement was made alongside Apple’s pledge to invest an additional $100 billion in the U.S. market, a move Trump praised as an example of the kind of commitment that would exempt firms from the proposed tariffs.

“For companies like Apple that are building in the U.S., there will be no charge,” Trump said during an Oval Office briefing. He warned, however, that companies failing to follow through on their manufacturing pledges would be penalized retroactively.

The tariff proposal is not yet formal, and key details—including implementation and country-specific exemptions—remain unclear. It comes just ahead of scheduled U.S. duties ranging from 10 to 50 percent taking effect on a wide range of imports from numerous trading partners.

The 100 percent semiconductor tariff is tied to an ongoing national security investigation into the sector, with official findings expected by mid-August. Trump’s remarks have triggered swift international responses, particularly from countries with large semiconductor industries.

South Korea quickly moved to reassure stakeholders, with its top trade envoy confirming that chip giants Samsung Electronics and SK Hynix would not be affected due to favorable terms under a trade agreement with the U.S. Meanwhile, Taiwan’s TSMC and other major firms with U.S. operations are also expected to avoid the tariff impact.

“There’s so much serious investment in the United States in chip production that much of the sector will be exempt,” said Martin Chorzempa, a senior fellow at the Peterson Institute for International Economics.

However, not all countries welcomed the announcement. Dan Lachica, president of the Philippine semiconductor industry, described the proposal as “devastating” for his country, while Malaysia’s trade minister warned that losing U.S. market competitiveness could damage the nation’s chip sector.

Shares in Asian semiconductor companies surged on Thursday as markets digested news that firms with U.S. factories would likely benefit. Taiwan’s TSMC rose 4.4 percent, Samsung gained 2 percent, and silicon wafer maker GlobalWafers, which operates a Texas plant, jumped 10 percent.

“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 Annex Wealth Management.

The U.S. produced just 12 percent of the world’s chips in 2023, down from 40 percent in 1990. To reverse that trend, Congress approved a $52.7 billion semiconductor subsidy package in 2022, encouraging industry leaders to localize production.