Trump vows 100% tariff on chips, unless being built in the USA

US President Donald Trump has vowed 100% tariff on chips, unless companies involved are building those in the USA.

Trump said: "We will be putting in tariff at 100% on semiconductors, unless they are being built in the USA. If you are building those in the United States, there is no charge. There are things like a big number of jobs, if you are building chips in the United States."

CNBC's Megan Cassella added that the list of companies with the commitment to build chips in the United States is quite long, especially after the CHIPS Act was announced by the Joe Biden administration on Aug. 9, 2022. The Act authorizes roughly $280 billion in new funding to boost domestic research and manufacturing of semiconductors in the United States.

Already, big names are involved, such as Intel, IBM, NVIDIA, TSMC, etc., that are building chips in the USA. They are all potentially shielded from this move. 

In the meantime, the tariffs would be imposed under Section 232, that requires the Commerce Department to find the semiconductor imports that represent a threat to the United States national security. Their investigation is expected to wrap up as soon as possible. The tariffs would come very shortly after that.

So, this leaves a question: how big would any exemptions be? Also, how broadly are the tariffs going to be written? Whether they could ultimately include any derivative products, such as smartphones or other devices that include semiconductors, as well? As of now, it could be any product that includes a semiconductor. That is also under investigation. Ultimately, they could also face tariffs. This fact is really shaking the entire technology market, if the US government wrote the tariff it in that way. 

Earlier, Apple had announced that it will invest an additional $100 billion in the USA. Apple hopes for sidestepping the tariffs imposed by USA.