The U.S. administration is weighing a proposal to impose tariffs on imported electronic devices based on the number of chips they contain, according to three sources familiar with the matter. The plan, still under discussion and subject to change, is aimed at encouraging companies to shift more production to the United States.
Under the draft proposal, the Commerce Department would calculate tariffs as a percentage of the estimated value of the chip content within each product. This approach could extend to a wide range of consumer goods, from laptops to household devices, potentially raising retail costs.
When asked about the matter, a White House spokesperson said the administration’s broader strategy is focused on reshoring manufacturing critical to national and economic security. Measures under review include tariffs, tax cuts, deregulation, and expanded domestic energy production.
Analysts caution that such tariffs could increase consumer prices at a time when inflation remains above the Federal Reserve’s 2% target. “Even U.S.-made products could see higher costs because they rely on imported components,” said Michael Strain, an economist with the American Enterprise Institute.
The U.S. has already introduced significant tariffs this year, including 100% duties on branded drugs and 25% levies on heavy-duty trucks. In April, the administration launched investigations into imports of semiconductors and pharmaceuticals, citing concerns over reliance on foreign manufacturing.
Uncertainty remains about the range of products that could be covered, the potential tariff rates, and possible exemptions. In August, the U.S. announced plans for a 100% tariff on imported semiconductors, exempting companies that manufacture or invest in production facilities within the country.
Major foreign chipmakers such as Taiwan Semiconductor Manufacturing Co. and Samsung Electronics could be directly affected. Preliminary discussions suggest tariff rates could reach 25% on chip-related content, with lower rates of around 15% considered for imports from Japan and the European Union.
Sources also indicated that the Commerce Department is reviewing an exemption system tied to U.S. investment, under which companies might offset tariff costs if they move at least half their production to the U.S. However, it is unclear whether this framework will be adopted.
Proposals to exclude chipmaking tools from the tariffs have also been discussed to avoid raising costs for U.S. semiconductor producers, though officials say the White House is reluctant to allow broad carve-outs.
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