Trump Announces 100% Tariff on Chips and Semiconductors

President Donald Trump on Wednesday said he plans to impose a 100% import tax on chips and semiconductors, once again weaponizing tariffs as a way to incentivize manufacturing in the United States.

“We’ll be putting a tariff of approximately 100% on chips and semiconductors. But if you’re building in the United States of America, there’s no charge,” Trump said during a White House event.

It remains unclear when the levy will go into effect or how much a company would have to invest in the United States to gain an exemption from the tax.

Trump has threatened a 100% tariff on semiconductors and chips previously, and indicated Monday on CNBC that a formal announcement would be coming soon. A steep import tax on chips and semiconductors, both of which are essential components of electronic products, will likely drive up the cost of phones, laptops, computers and other devices.

Trump made the announcement Wednesday in the Oval Office next to Tim Cook, the CEO of Apple.

Cook was there to formally announce an additional $100-billion investment commitment to the United States, bringing the company’s total up to $600 billion. The president said companies who make and keep such investment commitments wouldn’t be subject to the import tax.

“But the good news for companies like Apple is if you’re building in the United States or have committed to build, without question, committed to build in the United States, there will be no charge,” Trump said.

Cook at one point presented Trump with a 24 carat gold plaque that he said was designed by an Apple engineer.

“Thank you President Trump for putting American innovation and American jobs front and center,” Cook said.

Apple is one of many companies to make hefty investment commitments during Trump’s second term.

Part of Apple’s investment is set to go toward building a glass production line in Kentucky, where Cook says all cover glass for every new iPhone and Apple Watch will be manufactured.

“The great people of Kentucky, you’re going to find it a great place to do business,” Trump told Cook. “Fantastic. Isn’t that nice? We’re doing these things now in the United States instead of other countries, far away countries.”

For companies that don’t fulfill those commitments, the president said tariffs would be collected retroactively.

“If, for some reason, you say you’re building and you don’t build, then we go back and we add it up, it accumulates, and we charge you at a later date. You have to pay, and that’s a guarantee,” Trump said.