America’s Chip Tariff Gambit: How the US Strongarmed Taiwan Into a $250B Manufacturing Bet

The US just flipped the economic script on global chip manufacturing—leveraging Trump’s 100% tariff threats to force Taiwan into a $250 billion bet on American soil.

The US reduced tariffs on Taiwanese goods from 20% to 15% in exchange for $250 billion in investments from Taiwanese tech companies into US chip manufacturing. Commerce Secretary Howard Lutnik framed the deal as a calculated risk:

"That’s what they get if they don’t build in America, the tariff’s likely to be 100%"

Taiwanese chipmakers can import 2.5x planned capacity tariff-free during construction and 1.5x post-construction, creating a phased loophole to ease transition costs.

TSMC, the world’s largest chipmaker, has already committed $100 billion to US expansion and plans six new semiconductor fabs in Arizona. Lutnik emphasized Taiwan’s strategic calculus:

"They need to keep our president happy… Donald Trump is vital to protecting them"

Reciprocal tariffs on pharmaceuticals, aircraft parts, and natural resources will be eliminated, while Trump’s 25% tax on AI chip sales to China remains in place.