Chipmaker TSMC 'exempt' from Donald Trump's 100% tariff, says Taiwan

US President Donald Trump announced that the US will impose a tariff of about 100% on semiconductor chips imported from countries not producing in America or planning to do so

 

Taiwanese chipmaking firm TSMC "is exempt" from US President Donald Trump's 100 per cent tariff on semiconductor chips, Taipei said Thursday, according to a report by news agency AFP. National Development Council chief Liu Chin-ching briefed his country's legislature that because TSMC has factories in the US, TSMC is exempt from the tariffs.  

 

US to impose 100% tariff on chip imports 

 

On Wednesday, US President Donald Trump announced that Washington would introduce a 100 per cent tariff on computer chip imports. He stated that companies manufacturing chips within the US would be exempt from the import duty.

 

 

Trump highlighted that the new tariff rate would apply to “all chips and semiconductors coming into the United States", except for firms that had already committed to manufacturing in the US or were in the process of establishing production facilities.

 

Trump stated, “If, for some reason, you say you're building and you don't build, then we go back and we add it up, it accumulates, and we charge you at a later date, you have to pay, and that's a guarantee.”

 

Global demand for computer chips has been increasing steadily, with sales rising by 19.6 per cent in the year ending in June, according to the World Semiconductor Trade Statistics organisation.

 

'Much of semiconductor sector to be exempt'

 

Martin Chorzempa, senior fellow at the Peterson Institute for International Economics, stated that much of the sector would be exempt as there has been significant investment in chip manufacturing within the US. Chorzempa added that, since chips produced in China would not be exempt, those made by SMIC or Huawei would also fall under the tariffs, as such chips typically entered the US market embedded in devices assembled in China. He also underlined that the impact of the tariffs might be minimal if they were not accompanied by a component tariff.

 

Under Joe Biden, the Commerce Department in 2024 secured commitments from all five leading-edge semiconductor companies to set up chip factories in the US as part of a national initiative. 

 

Brian Jacobsen, chief economist at investment advisory firm Annex Wealth Management, said that large and cash-rich companies with the capacity to build in the US stood to gain the most from the current environment, describing it as a case of "survival of the biggest".

 

The proposed tariffs are expected to be primarily directed at China, with trade negotiations between Washington and Beijing still ongoing.

 

Samsung, SK Hynix will not be subject to 100% US tariffs: Envoy 

South Korea’s chief trade envoy, Yeo Han-koo, stated on Thursday that Samsung Electronics and SK Hynix would not be subject to the 100 per cent US tariffs on chips.Yeo said South Korea would receive the most favourable US tariff treatment on semiconductors under the trade agreement between Seoul and Washington.