US executive bodies are considering the introduction of sweeping new tariffs on semiconductor products as part of a policy to boost domestic chip manufacturing, Politico reports, citing eight sources familiar with the matter. According to the publication, discussions are underway about potentially expanding the list of technology goods subject to import duties. Product categories such as laptops, gaming consoles, and data center servers could fall under the scope of the new trade levies.
Under the approach supported by Commerce Secretary Howard Lutnick, exemptions from tariffs for foreign companies would reportedly be tied to investments in chip manufacturing on US soil. The measure is aimed at increasing domestic semiconductor output and building additional production capacity in the country. A transition period for the new tariffs is currently under consideration, though the concept may be revised in the coming weeks or months as discussions continue.
The new tariffs are facing resistance from the technology industry, which is already experiencing a supply shortage that has sharply driven up prices for memory chips critical to artificial intelligence systems. Nvidia, in particular, warned investors on Wednesday that gross margins in the coming quarters would be under pressure due to high memory chip costs. Such concerns reflect broader market anxiety over additional cost increases amid the existing component shortage.
Technology industry representatives said they do not object to the goal of expanding chip manufacturing in the US, but pointed to the practical challenges of implementing the initiative. Building semiconductor manufacturing facilities requires billions of dollars in investment and several years to complete. Until production capacity is expanded, American companies will have to rely on imports from overseas, primarily from Asian suppliers in Taiwan, South Korea, and Malaysia, which currently dominate the global semiconductor market.