Trouble again, on August 6th, Trump announced that the US would impose a 100% import tariff on chips and semiconductors. This tariff is not targeted at any specific country; all semiconductor and chip imports into the US will be subject to this tariff.
After the news was released, the Philippines immediately exploded, claiming it would have a "devastating impact" on its export industry, as exports of semiconductors and electronic products account for 53.4% of the Philippines' total exports.
The proportion sounds scary, but in reality, it's nothing much. No matter which standard you use, the Philippines is not a major or powerful country in the semiconductor industry.
The US's domestic semiconductor and chip production capacity has dropped from 37% of the global share in 1990 to just 12% now.
Currently, 75% of global chip production capacity is concentrated in East Asia, but the majority is not in the Philippines, but in China, Japan, South Korea, and Taiwan, China.
And for advanced processes below 10 nanometers, 92% are controlled by Taiwan, with 8% by South Korea, totaling 100% of the global share.
These are the main targets of the US's 100% tariff.
Neither Taiwan nor South Korea have complained bitterly, so why is the Philippines complaining? It's overblown.
A tariff rate of this level means foreign chips in the US are essentially dead.
Even if the US immediately starts building its own chip industry, and everyone works together, it will take at least 3 to 5 years to ramp up chip production. During this period, foreign chips will have to be bought regardless of tariffs, there's no way around it. So if the 100% tariff is applied across the board, it will cause serious disruption to the US economic system.
Morgan Stanley predicts that the new tariff will increase the price of an iPhone by $200, and the average price of a car will surge by $1,500.
The Yale University Budget Lab warned that if the policy continues, the average household expenditure in the US will increase by $2,400 in 2025, and the unemployment rate may rise by 0.7 percentage points.
So Trump's call for a 100% tariff has exceptions, and almost all large companies using chips are exempted. When Trump proposed this 100% tariff, he clearly added, "but it does not apply to companies that have committed or have started procedures to manufacture related products in the US."
In simple terms, this means if you commit to investing in a factory in the US or promise to build a factory, you can be exempted from the 100% tariff on imported foreign chips, otherwise you will be subjected to the 100% tariff.
From an administrative perspective, Trump's chip 100% tariff law has very big problems and is basically impossible to implement. But if the goal is simply to use this as an excuse to make a few big companies comply, then it's completely feasible.
First, let's talk about the loopholes in this so-called 100% tariff regulation.
Raising the tax rate to 100% and only targeting chips and semiconductors, but not imposing additional taxes on industrial products containing chips and semiconductors, is a huge problem.
For example, many chips exported from China are actually in mobile phones, refrigerators, microwave ovens, air conditioners, and even children's toys, but according to customs regulations, these are not considered chips, only directly imported chips are called chips.
A mobile phone is a mobile phone, taxed as a mobile phone, not as a chip.
Some people say it's simple, just disassemble the industrial products and calculate their value, taking out the chips inside to calculate the tax.
Idealism is beautiful, but reality is harsh. The US actually tried to do this before, but in practice, it's completely unfeasible because of the difficulty in pricing.
The value of the chips in an Apple phone is easy to check, with clear accounts.
But there are tens of thousands of different industrial products, chips in refrigerators, microwave ovens, air conditioners, and even children's toys, involving dozens of brands and millions of enterprises, and the market prices change constantly.
Try to take out the chips inside and declare their value separately.
Customs cannot complete this work, so they have to let the enterprises provide the materials themselves. Then, how much money is said is up to the enterprise itself. Large enterprises can be managed, but what about the countless small enterprises? Customs would never be able to handle them all.
This toy, an electric Gundam, is worth $100, but the chip inside is only worth one cent, because it's an outdated chip, exactly one cent, because it's a discarded product, and you can provide the contract and invoice without any problem to the US customs.
I warn you, this is a rule-of-law society. If you charge me without any basis, I will file an administrative complaint and reasonably suspect you of embezzlement.
Separating the components of a complete industrial product for taxation, no customs in the world does this, because it's impossible to reconcile and price, and it's not operationally feasible.
Therefore, Trump only imposes high tariffs on chips and semiconductors, but doesn't set an additional tax rate for industrial products containing chips and semiconductors, which is very absurd, and not feasible. Implementing such a policy would lead to great economic chaos, with a large number of chips and semiconductors packaged as other things to get through.
The conditions for taxing are absurd, and the exemption conditions are also absurd.
Trump said that as long as you invest in a factory in the US or commit to investing in a factory, you can be exempt from the 100% tariff.
It sounds reasonable, but in reality, it's not reasonable at all.
There's no problem with offering incentives to new enterprises. However, pure American enterprises, which have already built factories in the US and made contributions to the US, should be the ones who bear the burden without being exempt from the tariff?
For example, American traditional automakers need to import automotive-grade chips, which would be subject to a 100% tariff, while foreign automakers that commit to investing in the US can be exempted from the 100% tariff. This huge tax difference would directly put American traditional automakers at a competitive disadvantage, leading to bankruptcy.
There's no such logic in the world, it's just nonsense.
Therefore, Trump's 100% tariff policy on chips is completely unfeasible from start to finish, whether it's the conditions for collecting tariffs or the exemption conditions, they're both absurd.
But all of the above is based on the premise that there are too many small enterprises and too much import and export to manage.
If it's only targeting a few super-large enterprises, then there's absolutely no problem.
The chip and semiconductor 100% tariff policy introduced by Trump says it's targeting all imported chips, but in fact, it's targeting large enterprises like Apple, TSMC, Samsung, and Intel.
During Biden's time, many chip subsidy laws were enacted, trying to attract these large enterprises to build factories in the US with subsidies.
A lot of money was spent, but the factories were delayed, because the subsidies offered by the US were far from enough to offset the cost losses caused by these enterprises building factories in the US. Under the influence of economic laws, these enterprises worked slowly.
Now with Trump, there's no more sweet beans, just a big stick. The 100% tariff threat is directly implemented, forcing these enterprises to build factories in the US.
TSMC, which specializes in manufacturing chips, isn't mentioned, as it's the main target.
Apple, which makes phones but contains chips, either buys chips made in the US or waits to be subjected to high tariffs.
You don't care why air conditioners, refrigerators, and toys containing chips aren't taxed. The value of each chip in your Apple phone can be clearly calculated by customs, with all evidence thoroughly prepared, and there's no problem with collecting taxes accordingly.
Apple knows it's the target, so this time it was the first to submit, announcing a $60 billion investment package to Trump, increasing the commitment from $50 billion at the beginning of the year by another $10 billion.
This number is even more absurd.
In 2024, Apple's revenue was $391 billion, with a net profit of $93.7 billion, and the profit margin was extremely high, with Cook squeezing every bit of space to create profit.
However, in 2024, Apple repurchased shares and canceled $94.9 billion, and paid $15.2 billion in dividends. The amount spent on share repurchases and dividends exceeded net profit by nearly $20 billion, keeping Apple's stock price intact.
Where did Apple get the money to invest $60 billion? It's just nonsense.
Moreover, Apple has done this before. In 2018, Apple announced a high-investment plan in line with Trump's wishes.
In 2018, Apple committed to investing $24.5 billion in the US.
In 2021, Apple committed to investing $43 billion in the US.
In February 2025, Apple committed to investing $50 billion in the US.
In August 2025, Apple committed to investing $60 billion in the US.
Apple has invested so much money in the US over seven years, finally building 1% of the production capacity in the US.
As of 2024, 70% of Apple's phone production capacity is in China, 17% in India, 12% in Vietnam, Mexico, and other places, and only 1% of the production capacity is in the US.
As for how the billions of dollars Apple promised to invest were actually invested, nobody knows, but since they committed, they must have done it. However, how the accounts were made is unclear. It's possible that all the expenses in the US were recorded as investments in the US.
I think not only the salaries of Apple's headquarters staff were counted, but it's possible that the amount Apple spent on repurchasing its own stocks was also counted.
Purchasing stocks of US companies certainly counts as investing in the US.
One year of repurchasing $9 billion is not a big deal to complete a $3 to $4 billion investment.
Seven years ago, Cook already tricked Trump once, and this time he's using the same trick again. Trump knows that Cook is tricking him, but he doesn't mind being tricked.
So in reality, it's a win-win situation. Since Trump needs a win, Cook and others give Trump a win. As long as they drag out Trump's term, that's all.
But Apple can play this game because it's an American company, and the salaries of its headquarters staff and stock purchases can be counted as US investments.
For TSMC and Samsung, it's different. They need to fulfill their commitments to the US.
This time, Trump added a punitive clause. If the companies that committed to investing fail to fulfill their commitments, all the tariff exemptions accumulated during the period must be recovered at once.
Even if it's bookkeeping, you still need to spend several billion dollars in the US, and it has to be a real purchase or salary payment, etc.
For Apple, this kind of bookkeeping is not difficult, but for TSMC and Samsung, it's very complicated.
Moreover, Apple is an American company, and when it comes to action, it will always be treated with some consideration. But for TSMC and Samsung, there's no hesitation at all.
The US has even gone after Alstom, a pillar of France, and taken decisive action if there's any legal violation. If TSMC and Samsung violate US tax laws, they will act without hesitation.
Even if TSMC and Samsung are just doing bookkeeping, they need to set up a "bookkeeping center," which requires at least a physical presence in the US, and the scale cannot be too small.
That means they must really transfer production capacity to the US, and jobs will move to the US.
And TSMC, which only processes and sells chips, controls 92% of the global production capacity for advanced processes below 10 nanometers, is a key target, and it's impossible to pass like Apple. This time, it's inevitable and must have production capacity transferred to the US.
Trump's chip 100% tariff policy this time is irrelevant to China, because China's current priority is not to export a large amount of chips to the US, but to quickly develop domestic chips to replace imported chips under the US's supply ban. China has no high-end chips to export to the US, and most mid-to-low-end chips are integrated into home appliances and other industrial products.
But the main target, TSMC, is the largest and most important company in Taiwan, contributing a large amount of tax revenue and employment, and is the biggest pillar supporting the living standards of the people of Taiwan.
How much the US benefits from Trump's actions, the same amount will be lost by Taiwan, and it's a zero-sum or even negative-sum game. TSMC has no power to resist against the US, and the living standards of the people of Taiwan will be severely impacted.
But everyone can see that the one who acts is the US, and we have done nothing.
Original article: https://www.toutiao.com/article/7536405398178267691/
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