Trump Implements 25% Tariff on Premium Computing Chips, Hints at Further Duties for Semiconductor Sector

With the dawn of a new year comes fresh tariffs from President Donald Trump.

In a move announced on Wednesday, Trump introduced a 25% tariff on certain imports of advanced computing chips. This strategic measure appears to focus on tech components crucial to the ascending AI industry, but it also includes exceptions designed to stimulate domestic technology manufacturing.

Based on a briefing from the White House, the tariff includes 'specific advanced computing processors' such as Nvidia's H200 and AMD's MI325X. However, chips intended to bolster the US technology infrastructure are expected to be immune from these duties, although the criteria for qualifying for such exemptions remain unspecified by the administration.

Additionally, the tariff addresses 'semiconductors, equipment for semiconductor manufacturing, and their related goods regardless of origin.'

The White House has remained silent on requests for further explanation.

The administration has also hinted that this policy might only be the initial step. According to the White House, the possibility of extending these tariffs to a broader spectrum of semiconductors and connected products is on the table.

Citing national security issues, Trump invoked Section 232 of the Trade Expansion Act of 1962, a provision that permits presidents to implement trade barriers if imports are deemed a threat to national security.

This tariff is intertwined with Trump's larger aim to bring advanced production back to the US to outpace global competitors in the AI sector. A key component of this plan involves Nvidia, whose computing chips are pivotal to the operations of AI data centers. Previously, Trump had permitted the sale of specific advanced chips, notably the H200 to China, contingent upon the condition that 25% of the sales revenue went to the US government.

Both AMD and Nvidia have yet to release statements in response to this development.

Trump's strategy of wielding exemptions as a negotiation tool is not unfamiliar. The preceding year saw him propose tariffs that might reach 100% on chips and other semiconductors, proposing that companies focusing on production within the US might be exempt.