The Trump administration is weighing a new tariff scheme that would tax imported electronic devices based on the number of chips they contain, according to people familiar with the matter. Under the proposal, the Commerce Department would levy a duty calculated as a percentage of the estimated value of a product’s chip content.
White House spokesperson Kush Desai said the plan reflects efforts to reduce reliance on foreign semiconductors, describing it as part of a broader strategy combining tariffs, tax cuts, deregulation and energy policy to bring manufacturing back to the U.S.
If enacted, the policy could cover a wide range of consumer goods — from laptops to electric toothbrushes — potentially pushing up prices at a time when inflation is already running above the Federal Reserve’s 2% target. Analysts warn that the plan risks adding to inflationary pressures not just for imports but also for U.S.-made products, which rely on semiconductor components as inputs.
Info via a weekend Reuters report.
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Mkt impact thoughts:
Equities: Consumer electronics makers and retailers may face higher costs, squeezing margins and raising prices.
Underscores Washington’s push to reshore chip manufacturing, potentially boosting U.S. chipmakers.
Further tariffs risk fueling inflation, complicating the Fed’s path as it struggles to anchor prices at 2%.
