US President Donald Trump has imposed a 25% tariff on advanced AI chips, including the widely used Nvidia H200 and the AMD MI325X. Effective immediately, the measure is motivated by national security concerns.
The proclamation follows a nine-month investigation under Section 232 of the Trade Expansion Act of 1962. The US government argues that the country’s reliance on foreign chip production—currently only 10% of its chip requirements is manufactured in the US—poses a significant risk. With these tariffs, Trump aims to force manufacturers to relocate their production to the US and reduce dependence on on chip manufacturers in places such as Taiwan.
It’s pertinent to note that the tariffs do not apply to chips intended for US data centers, startups, and non-datacenter consumer applications, non-datacenter civil industrial applications and US public sector applications.
The focus is specifically on chips shipped via the US to foreign countries, such as China. Chips destined for the Chinese market will now have to travel through the US for testing by a third-party lab, where the tariffs will be applied immediately.
