Trump says he plans to put a 100% tariff on computer chips, likely pushing up cost of electronics
Trump Announces 100% Tariff on Computer Chips
By JOSH BOAK and MICHAEL LIEDTKE, Associated Press
WASHINGTON (AP) — President Donald Trump revealed plans on Wednesday to impose a 100% tariff on computer chips, potentially leading to increased prices for electronics, automobiles, household appliances, and other essential products reliant on these processors.
During a meeting with Apple CEO Tim Cook in the Oval Office, Trump stated, “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.”
This announcement follows a temporary exemption granted by Trump to most electronics from his administration’s stringent tariffs over three months ago.
Trump specified that companies producing computer chips within the U.S. would be exempt from the import tax. The shortage of computer chips during the COVID-19 pandemic had led to increased auto prices and contributed to higher inflation.
Investors viewed the potential tariff exemptions favorably, particularly for major tech companies like Apple, which have committed substantial financial resources to manufacturing more chips in the U.S.
Big Tech companies have collectively pledged approximately $1.5 trillion in investments in the U.S. since Trump’s return to the White House in January. Apple, for instance, increased its commitment by an additional $100 billion following a $600 billion promise made earlier this year.
The agreement between Cook and Trump raises questions about whether it will shield millions of iPhones manufactured in China and India from existing tariffs and alleviate pressure on Apple to raise prices on upcoming models.
Following Trump’s announcement that certain tech companies would be spared from the latest tariffs, Apple’s stock price surged by 5% during regular trading hours and an additional 3% in extended trading.
Nvidia, a leading AI chipmaker, also experienced a slight stock price increase in extended trading, adding to the company’s $1 trillion market value gain since the beginning of Trump’s second term.
Intel, a renowned computer chip pioneer, saw its stock price rise in extended trading as well.
Requests for comments from chip manufacturers Nvidia and Intel were unanswered, while the Semiconductor Industry Association, the chip industry’s main trade group, declined to provide a statement on Trump’s latest tariffs.
Global demand for computer chips has been on the rise, with sales increasing by 19.6% in the year ending in June, according to the World Semiconductor Trade Statistics organization.
Trump’s tariff threats represent a significant departure from the initiatives put forth during President Joe Biden’s administration to revive computer chip production in the U.S.
Since assuming office, Trump has utilized tariffs to encourage domestic production, banking on the notion that the fear of substantially higher chip costs would incentivize companies to establish factories in the U.S., despite potential impacts on profits and consumer prices.
On the other hand, the bipartisan CHIPS and Science Act signed into law by Biden in 2022 allocated over $50 billion to support new computer chip plants, fund research, and train industry workers. This approach aimed to attract private investment, a strategy that Trump has vocally opposed.
Liedtke reported from San Ramon, California.
Originally Published: August 6, 2025 at 3:39 PM MDT
