US Imposes Tariffs on Chinese Semiconductors Starting in 2027

The United States plans to impose tariffs on imported semiconductors from China beginning in 2027. This decision stems from a detailed investigation into China's semiconductor industry, initiated by the Biden administration in December 2024.

The investigation concentrated on "foundational" or "legacy" semiconductors and their role in vital sectors such as defense, automotive, medical devices, aerospace, telecommunications, and the electrical grid. The findings highlighted that China has long targeted the semiconductor sector for dominance, employing aggressive non-market strategies that have disadvantaged U.S. companies, workers, and the broader economy.

As a result, the U.S. has announced that tariffs on Chinese chips will remain at zero percent until mid-2027, after which tariffs will increase. The exact rate will be determined at least 30 days before implementation, with tariffs scheduled to rise on June 23, 2027.

Strategic Uses of Tariffs and Incentives

US Trade Representative Jamieson Greer emphasized that tariffs can serve as a negotiation tool, encouraging Chinese chipmakers to consider opening their markets to American investments. These strategies echo efforts under the CHIPS Act, which have already prompted companies like TSMC, Samsung, and Intel to expand or establish manufacturing facilities in the United States.

Broader Context of Global Semiconductor Trade

Recent developments also include other trade measures:

• US PC shipments slow due to tariffs
• EU and US confirm a 15% tariff cap on certain chips
• The US reduces tariffs on major tech exporters, though prices remain higher for consumers
• India introduces a 25% tariff on imported semiconductors starting Friday

In earlier speeches, President Trump suggested that tariffs on imported semiconductors could reach 25%, 50%, or even 100%. However, current announcements do not specify such extreme tariffs, signaling a strategic shift toward more measured trade policies.