The Trump administration is reportedly weighing a new round of sweeping semiconductor tariffs. These could go significantly further than anything previously imposed, covering not just chips but also the products that use them, including laptops, gaming consoles, and data centre servers.
A phase-in period is being considered to avoid the worst impacts hitting all at once. The White House said in a statement to Reuters that reshoring semiconductor manufacturing remains a top priority. It added, however, that any reporting about tariffs not officially announced should be regarded as baseless speculation.
The US still relies heavily on Asia for advanced semiconductor production. More than 90% of the world's most advanced chipmaking capacity sits within Asian supply chains. TSMC has committed $265 billion to its Arizona facility, the largest foreign direct investment in US history.
Even after its full completion, however, only around 30% of TSMC's most advanced capacity will be in the US, with significant production still several years away. As a result, any tariffs would hit companies relying on imported chips well before domestic capacity can fill the gap.
The Computer and Communications Industry Association estimates that taxing both semiconductors and downstream products could cost the US around $90 billion in GDP losses every year. It also estimates that roughly 20% of data centre projects planned through 2030 could be delayed or cancelled.
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The impact would also spread far beyond chipmakers. NVIDIA and AMD rely on overseas manufacturers for chip production and could face higher costs as a result. Apple could also face a competitive disadvantage in foreign markets, where rivals can buy the same chips without paying US import tariffs. For consumers, smartphones, laptops, tablets, gaming consoles, and other everyday devices could become even more expensive, on top of an already brutal year for hardware costs.
