U.S. President Donald Trump has announced his intent to impose import tariffs as high as 100% on computer chips and semiconductors. In a speech at the House GOP Issues Conference in Miami on Monday, he also suggested he would remove Joe Biden’s program of paying subsidies to chip makers like Intel or TSMC to build fabrication plants in the U.S.
Regarding chip production, Trump says, “They left us and they went to Taiwan, which is about 98% of the chip business, by the way. And we want them to come back and we don’t want to give them billions of dollars like this ridiculous program that Biden has.” However, the U.S. International Trade Commission estimates that about 44.2 percent of imported logic chips are manufactured in Taiwan as of 2023.
The Biden administration policy subsidized companies that manufacture in the United States in the hope of increasing domestic semiconductor production. The Chips and Science Act signed by Biden in 2022 includes US$53 billion in subsidies for chip companies with the aim of catching up with China in semiconductor manufacturing.
"It's time for America to return to the system that has made us richer and stronger than before," Trump said, comparing his approach to the high tariffs pushed by former President William McKinley in the 1890s. Other products which may see increased tariffs include steel, copper, aluminum, and "things our military needs,” Trump said. However, economists warn that tariffs could lead to higher consumer prices, which would directly affect Trump’s pledge to keep inflation down.
