Donald Trump said he would impose 100% tariffs on foreign computer chips, which could increase the cost of electronics, cars, household appliances and other commodities deemed essential to the digital age.
“We’re going to impose a tax rate of about 100% on chips and semiconductors,” Trump said in the Oval Office during a meeting with Apple CEO Tim Cook. “But if you build in the United States of America, then you don’t care.”
The Republican president said companies that make computer chips in the United States would be exempt from import taxes. Amid the Covid-19 pandemic, a shortage of computer chips has raised the prices of cars and led to an overall rise in inflation.
Trump and Cook meet on Wednesday to discuss Apple invests $10 billion Manufacturing in the United States for the next four years. This is the iPhone Maker that has promised to invest $50 billion in the country earlier this year. With Apple’s new investment, the total is now $60 billion.
Apple has been backed up as a US-based technology company, but conducts most of its manufacturing industry abroad. For example, most of Apple’s products are produced in China 90% of iPhones are assembled there. Cook has met with Trump several times since the president took office to discuss more of the U.S. manufacturing industry.
NVIDIA is one of the largest chip manufacturers in the United States and is likely to be exempt from tariffs as the company has manufacturing facilities in the United States.
Queries sent to NVIDIA and CHIP MAKER INTEL were not immediately answered.
Demand for computer chips has been rising globally, with sales in June rising 19.6%.
Trump’s tariff threat marks a major breakthrough in existing plans to restore U.S. computer chip production. He is choosing a way to favor the well-known sticks over carrots to inspire more yields. Essentially, the president’s bet on higher chip costs will force most companies to open factories at home, although tariffs could squeeze out company profits and drive up prices for phones, TVs and refrigerators.
By contrast, the Tapartisan Chips and Science Act, signed by Joe Biden in 2022, has provided more than $50 billion in funding to support new computer chip factories, fund research and training workers in the industry. A combination of funding support, tax credits and other economic incentives is designed to attract private investment, a strategy Trump opposes.
Trump’s new 100% tariff on foreign computer chips will be officially announced next week and is expected to apply for all countries and companies.
Health & Wellness Contributor
A wellness enthusiast and certified nutrition advisor, Meera covers everything from healthy living tips to medical breakthroughs. Her articles aim to inform and inspire readers to live better every day.
