Trump Set to Announce Tariffs on Semiconductors and Chips

The semiconductor sector is facing another major shift in a turbulent year.

President Donald Trump disclosed on CNBC’s Squawk Box on Tuesday that his administration plans to propose tariffs on semiconductors and chips as early as next week. However, the specifics of these tariffs remain unclear.

These tariffs could significantly impact U.S. hardware and AI companies. When the U.S. CHIPs and Science Act was passed in 2022—providing $52 billion in subsidies to promote domestic chip production—the U.S. contributed only 10% of the global chip output. Despite this limited production capacity, over half of the global semiconductor firms are based in the U.S.

Since then, some progress has been made to bolster domestic chip manufacturing capabilities. Both Intel and Taiwan Semiconductor Manufacturing Company (TSMC) have received funding under the CHIPs Act, with TSMC committing to invest “at least” $100 billion in U.S. chip manufacturing facilities over the next four years.

However, building chip manufacturing plants is a time-consuming process. Intel recently announced a delay in the construction of its Ohio chip facility, further underscoring the challenges of rapidly scaling production capacity.

The anticipated tariff announcement comes as the industry awaits the administration’s decision regarding AI chip export restrictions—rules that define which countries can acquire advanced semiconductors used in AI applications.

In May, the Trump administration officially rolled back the Biden administration’s AI chip export regulations, which had established a country-specific, multi-tier framework for limiting chip exports due to national security concerns. Subsequently, in July, the Trump administration introduced its AI Action Plan, stressing the necessity for the U.S. to maintain chip export restrictions, although lacking clear implementation guidelines.

As reported by Semafor, the Trump administration is currently considering whether to move forward with its plans to rescind and replace Biden’s AI export regulations.

For ongoing updates on the semiconductor industry’s challenging year, we have curated a regularly updated timeline of market developments since early 2025.