Taiwan has requested further clarification from the United States regarding tariff exemptions and preferential treatment for semiconductor exports as Washington considers potential import tariffs on global chip products.
Speaking at a news conference on Thursday, Taiwan Vice Premier Cheng Li-chiun said U.S. officials had indicated during recent bilateral trade discussions that semiconductor imports, including those from Taiwan, could be subject to tariffs under Section 232 of the Trade Expansion Act on national security grounds.
Although Taiwanese semiconductor exports are currently exempt from tariffs, Cheng said Taiwan is seeking confirmation of tariff-free quotas and related benefits outlined in a bilateral investment memorandum of understanding (MOU) signed in January.
Under the agreement, the United States committed to providing tariff-free export quotas and preferential treatment for Taiwanese semiconductor manufacturers in exchange for direct investments by Taiwanese technology firms in advanced semiconductor, energy, and artificial intelligence production facilities in the U.S.
Cheng said Taiwan hopes the preferential arrangements can be finalized soon to reduce uncertainty for companies investing in the United States. She added that Taiwan has also requested that any future Section 232 semiconductor tariffs be implemented at a later stage to give businesses more time to adjust.
The vice premier, who leads Taiwan’s negotiating team in trade talks with Washington, said these concerns had already been communicated during previous rounds of discussions with U.S. officials.
According to the MOU, Taiwanese companies establishing semiconductor production facilities in the United States would be allowed to export semiconductor products equivalent to up to 2.5 times their planned U.S. production capacity without paying Section 232 duties.
Companies that complete new semiconductor manufacturing projects in the U.S. would also be permitted to import semiconductors equivalent to 1.5 times their new U.S. production capacity without incurring the tariffs.
Cheng said Taiwan hopes the United States will take into account the closely linked nature of the two economies’ high-tech industries when making decisions regarding semiconductor trade measures.
At the same briefing, Cheng announced that the United States had waived Section 232 tariffs on several Taiwanese products, including auto parts, timber, lumber, and wood derivative products, under the January trade agreement.
According to information published by the Office of the United States Trade Representative, tariffs on Taiwanese auto parts were reduced from 26.71% to 15%, aligning them with rates applied to the European Union, South Korea, and Japan.
Tariffs on wooden furniture were also lowered from 25% to 15%, while duties on aircraft parts and components classified as aluminum, steel, or copper derivatives were reduced to 1.12% from previous levels ranging between 15% and 51.12%.
Cheng said the revised tariff rates will be applied retroactively beginning May 1.
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