The Trump administration is considering imposing tariffs on foreign electronic devices based on the number of chips in each device, according to three people familiar with the matter, as it seeks to drive companies to shift their manufacturing to the United States.
According to the plan, which has not previously been reported and could change, the Commerce Department would impose a tariff on the imported product that is equal to a percentage of the estimated value of the chip content of the item.
If implemented, the plan would show the Trump administration is seeking to hit a wide range of consumer products, from toothbrushes to laptops, potentially driving up inflation as it seeks to ramp up U.S. manufacturing.
"America cannot be reliant on foreign imports for the semiconductor products that are essential for our national and economic security," White House spokesperson Kush Desai said, when asked about the details. "The Trump administration is implementing a nuanced, multi-faceted approach to reshoring critical manufacturing back to the United States with tariffs, tax cuts, deregulation, and energy abundance."
Trump said in August the United States would impose a tariff of about 100% on imports of semiconductors but exempted companies that are manufacturing in the U.S. or have committed to do so.
One of the sources consulted by Reuters said the Commerce Department was considering a 25% tariff rate for chip-related content in imported devices, with 15% rates for electronics from Japan and the European Union, stressing the figures were preliminary.
The sources added that the Commerce Department has also eyed a dollar-for-dollar exemption based on investment in U.S.-based manufacturing only if a company moves half its production to the U.S., but it was unclear how it would work or if it would move forward. The investment exemption was previously reported by the Wall Street Journal.
The Commerce Department had previously proposed to exempt chipmaking tools from the tariffs, three sources said, to avoid raising the cost of producing semiconductors in the United States and undermining Trump's reshoring goals. But the people said the White House was displeased by the carve-out, citing Trump's general distaste for exemptions.
Posted by John3262005
4 Comments
Tariff all the things! More is gooder!!!!
“Energy abundance” is such bullshit. We can never compete with China if they’re using sunshine and we’re sucking stuff from deep underground.
I have no idea why the GOP has declared war on cheap energy, but they have.
Edit: of course I have an idea …
Imagine being a customs broker during this administration. First, you have country-specific tariffs. Then, for every country, there are different rates for different sectors of the economy. On top of that, you have both blanket and percentage-based tariffs on individual goods. Finally, there is no more *de minimis* exemption, so all imports must be inspected, tariffed appropriately, and stored until the tariff is paid in full.
The number of potato chips, i assume.