AI industry says Trump plans to tax chips in the “single dumbest way imaginable”
Tech industry is perplexed by Trump’s plan to win AI race by taxing data centers.
Tech industry is perplexed by Trump’s plan to win AI race by taxing data centers.
The short version
- Donald Trump may be preparing to announce sweeping new semiconductor tariffs at the absolute worst time, the tech industry fears.
- Since Trump took office , trade groups have warned that imposing tariffs on both semiconductors and the many downstream products that use semiconductors—potentially even taxing used or refurbished products that contain chips—would be ruinous for the economy.
- Beyond disrupting the momentum of data centers, the tariffs could have wide-ranging ripple effects if certain products aren’t exempted, the CCIA said in a May letter to Treasury Secretary Scott Bessent, which was cosigned by about 20 trade groups.
What happened
“Consumer devices are the primary interface through which Americans access AI-powered tools. AI only delivers on its promise when people can actually use it—and tariffs that price consumers out of the device market would slow AI adoption at the very moment the United States is positioned to lead,” the letter said.
Why it matters
To shield AI firms, the Trump administration is mulling some tariff relief, but sources told Politico it would likely be tied to foreign firms investing in US chip manufacturing, like Taiwan Semiconductor Manufacturing Co.
Summary by Nerd News Network. Read the full article at Ars Technica via the links above and below.