Trump eyes 100% tariff on chips, firms investing in US to be exempted

Firms building in the US to be exempt; Trump signals broader import crackdown as India, Vietnam face new levies

US President Donald Trump said on Wednesday (local time) he would impose a 100 per cent tariff on imported semiconductors in a sweeping move to push tech manufacturing back to the US. However, companies that are building, or have committed to build production facilities in the US, will be exempted.

 

Trump made the announcement at the White House alongside Apple CEO Tim Cook, where the iPhone maker also unveiled a new $100 billion US investment plan.

 

Trump said the exemption would apply even to firms that have not yet started production, so long as their US projects are underway.  “We’ll be putting a tariff of approximately 100 per cent on chips and semiconductors. But if you’re building in the United States of America, there’s no charge,” Trump said, reported Bloomberg. 

 

 

Apple wins exemption, pledges new US investments

 

Apple emerged as the immediate beneficiary of the exemption, with Cook announcing a new $100 billion US investment plan designed to bring more of the company’s manufacturing home.

 

The expanded plan includes:

 

• A new manufacturing programme to localise production
• Partnerships with Corning Inc., Applied Materials Inc., and Texas Instruments
• A new glass production facility in Kentucky, with Corning increasing its workforce there by 50 per cent

 

This investment builds on Apple’s previously announced $500 billion plan, bringing its cumulative US commitment to $600 billion. The earlier plan includes a server manufacturing plant in Houston, a supplier academy in Michigan, and expanded supplier contracts across the country. 

 

Tariff threat looms for global chip supply chain

 

Despite Apple’s win, Trump’s surprise announcement has sent ripples through the tech industry, which remains unsure how broadly the tariffs will be implemented. Trump has so far spared consumer electronics like smartphones, monitors, and laptops from his nation-specific reciprocal tariffs. However, he hinted these items could be targeted next, especially if they contain semiconductors.

 

Trump confirmed the chip tariff is just one piece of a broader import crackdown, with new levies coming Thursday and more potentially next week.

 

Winners and losers: Who’s exempt, who’s exposed

 

If Trump’s exemption applies broadly to firms with US-based operations, several major chipmakers may avoid penalties. These include:

 

• Taiwan Semiconductor Manufacturing Co (TSMC)
• Samsung Electronics
• Intel Corp
• Texas Instruments
• Micron Technology
• GlobalFoundries

 

All have either operational factories or active expansion plans in the US. However, firms like Nvidia and AMD, which rely on outsourced chip manufacturing primarily in East Asia, may face challenges. While Nvidia has pledged significant US investments, it remains part of a globally complex supply chain that can’t be quickly reshored.

 

India, Vietnam targeted with new levies

 

Trump’s tariff agenda also includes steep duties on countries crucial to Apple’s manufacturing network. India, a major production base for iPhones, will be hit with a 50 per cent tariff, half aimed at trade imbalances and the rest as retaliation for India’s Russian energy imports. Vietnam, which makes Apple Watches, iPads and MacBooks, is already facing a 20 per cent tariff.

 

While specific implementation timelines and exemption criteria remain unclear, Trump singled out Apple as a model of compliance. 

 

Cook navigates Trump ties, tariffs

 

Cook’s long-standing ties with Trump may have helped Apple secure a favourable outcome. He attended Trump’s 2025 inauguration, donated to the president’s inaugural committee, and has held multiple meetings with the administration, including one earlier this year when Trump threatened a 25 per cent tariff if Apple didn’t shift iPhone assembly to the US.

 

Cook responded by noting that while final iPhone assembly would continue abroad “for a while,” many components were already being made in the US.

 

Trump appeared pleased with the response. “Look, he’s not making this kind of an investment anywhere in the world, not even close,” Trump said.