The Trump administration is evaluating the implementation of new tariffs on semiconductors following a decision to exempt certain electronic products from existing reciprocal tariffs. In a social media post, former President Donald Trump indicated that the focus of this review would be on semiconductors and the broader electronics supply chain as part of an upcoming National Security Tariff Investigation.
Kevin Hassett, the director of the National Economic Council, confirmed that the administration would conduct an investigation into semiconductors under Section 232 of the Trade Expansion Act of 1962. This section authorizes the president to impose restrictions on imports considered vital to national security following an investigation.
During an interview with CNN, Hassett emphasized the importance of semiconductors in defense equipment and mentioned that a thorough review would determine the necessity of producing certain components domestically to safeguard national interests.
These potential tariffs on semiconductors could be similar to the existing tariffs on steel and aluminum, which are also established under Section 232. Hassett highlighted the significant reliance on foreign, particularly Chinese, components in U.S. weapons systems as a national security concern.
The proposed tariffs come shortly after the U.S. lifted reciprocal tariffs on select electronics, including smartphones and computers. However, technology originating from China remains subject to a 20% “fentanyl” tariff, a punitive measure related to China’s involvement in the global drug trade.
Commerce Secretary Howard Lutnick informed ABC News that the current electronic tariffs exemptions are temporary and will soon be substituted by semiconductor tariffs. He indicated that these new tariffs would aim to encourage the reshoring of related products.
Statistics from the U.S. International Trade Commission reveal that China is the leading supplier of electronic products to the United States, followed by Mexico, Taiwan, Vietnam, and Malaysia.
