Overview
- Commerce Secretary Howard Lutnick confirmed the administration is developing a “targeted, thoughtful” tariff policy that will exempt companies that build U.S. capacity and charge duties on others, a stance he made public on Sept. 2.
- Officials are weighing a broader second phase that could extend duties beyond standalone chips to finished products such as servers, laptops and gaming consoles, which would raise costs for hardware that contains advanced semiconductors.
- The preferred approach links tariff relief to production commitments in the United States, but officials have not fixed which products qualify, what counts as U.S. production, specific tariff rates, country quotas or the phase‑in schedule.
- South Korea has sought assurances it will not be disadvantaged and is negotiating with Washington over how existing Korean investments will count toward relief, and major chipmakers are pressing Commerce for clear rules before changing investment plans.
- The plan builds on earlier 2026 actions — a Jan. 14 proclamation that imposed a 25% duty on select advanced chips and an Aug. 6 proclamation that set a 15% tariff on polysilicon — and could raise near‑term costs and slow AI data‑center builds because fabs take years and cost tens of billions to bring online.