President Donald Trump is considering imposing a 100 percent tariff on semiconductors to incentivize chipmakers to invest in domestic manufacturing, a move that would make it harder to build out American chip fabrication.
The Wall Street Journal reported on Friday that the Trump administration could soon force chipmakers "that don't maintain a 1:1 ratio [of domestic to imported chips] over time" to pay a tariff on each imported semiconductor sold to Americans beyond the number that are produced domestically. The Journal explains that, "if a company pledged to build one million chips in the U.S., it would essentially be credited with that amount over time so the company and its customers could import until its plant was completed without paying tariffs." This comports with Trump's August promise to chipmakers like Apple that "if you're building, there will be no charge."
It remains unclear just how long chipmakers would have to equalize their sales of domestic and imported chips. Likewise, the tariff rate that chipmakers would face is opaque, but Trump indicated last month that the rate could be as high as 100 percent.
