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US to impose semiconductor tariffs: rates could reach up to 100%?
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Industry News
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Release time:
2025-05-06
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May 5th, news: The Trump administration may announce details of semiconductor tariffs as early as this week. The market estimates that the tax rate could be as high as 25% to 100%, and the new rules may use the wafer out location as the origin for imposing tariffs. This will negatively impact major wafer manufacturers such as TSMC and Samsung, whose production is concentrated in Asia, as well as chip design manufacturers such as Nvidia, Apple, Qualcomm, and MediaTek, which rely on Asian wafer foundry capacity.
Policy Implementation Difficulties and Long-Term Impacts
Taxation Operational Challenges: Few semiconductor chips are directly exported from China and Taiwan to the United States. Most enter the US market through finished products like mobile phones and PCs. US tariffs typically apply to finished goods, not components.
Supply Chain Risks: If tariffs are implemented, the global supply chain may be restructured, leading to longer procurement cycles, increased costs, and weakened competitiveness for US chip manufacturers and electronics brands.
Economic Impact: If US-China tariffs exceed 100%, the semiconductor market size may decline significantly—potentially to $696 billion in 2024 (a 10% year-on-year decrease) and $557 billion in 2026 (a 34% year-on-year decrease).
Other Key Details
Trump's Motivation: To use high tariffs to force companies to build factories in the US and reduce supply chain dependence. In January, he stated: "If companies want to avoid tariffs, they must produce in the United States."
Historical Precedent: Previous lumber tariffs were delayed due to nearly 300 objections, while the scarcity of objections to semiconductor tariffs may accelerate policy implementation.
Cost Transfer Risk: Semiconductor companies may shift costs downstream, leading to higher prices for finished electronic products and suppressing consumer demand.
Summary
If high tariffs are implemented, the global semiconductor supply chain will face major adjustments: Asian manufacturers will face short-term pressure, while the benefits to US companies will be limited. In the long term, it may lead to market shrinkage and decreased industry chain efficiency. Although companies like TSMC are accelerating their US expansion, their overseas production capacity is still difficult to replace the existing supply chain. The ultimate impact will depend on the policy details, corporate response strategies, and the chain reaction in the global market.
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