COLUMBUS, Ohio (WCMH) -- President Donald Trump has promised sweeping tariffs on foreign semiconductors, but the move could have negative consequences for Intel's construction in Ohio.
Trump vowed to impose heavy tariffs on pharmaceuticals, steel and aluminum, oil and gas, and semiconductor chips. The last two are of particular relevance to Ohioans, who sit atop one of the largest oil and gas reserves in the world and who are mid-construction on Intel’s $28 billion semiconductor chip plants in New Albany. See previous coverage on the possible effects of tariffs in the video player above.
Trump, who announced and walked back several sweeping tariffs with major trade partners last week, has said tariffs between 25%-100% on foreign semiconductor chips are likely incoming. This is not entirely a novel concept; in September 2024, former President Joe Biden announced a 50% tariff on semiconductors made in China to go into effect in 2025. However, Trump’s tariff would target all foreign semiconductor industries, not just mainland China.
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Taiwan is a small democratic island in East Asia that claims and actively seeks independence from China, which claims it as its own. The U.S. has significant trade agreements with both Taiwan and mainland China and takes a neutral stance on the subject, according to the Department of State.
Stephen Ezell with the Information Technology and Innovation Foundation said the proposed tariffs would backfire, arguing the move would not drive Taiwanese technology firms to the U.S.
“Trump’s assumption is if he raises tariffs on Taiwanese semiconductors to 100%, Taiwanese semiconductor manufacturers will move to the United States to avoid them,” Ezwell wrote. “But if the United States imposes smaller tariffs on semiconductor imports from say India, Japan or Malaysia, the Taiwanese companies will only move their factories there, not necessarily to the United States. Or U.S. companies will buy their semiconductors from other foreign companies.”
American and foreign companies cannot yet purchase Intel semiconductor chips from the Ohio plants, which are not scheduled to become operational until 2027 or 2028. However, Intel sales in China and Taiwan alone made up $25.72 billion of the company's $53.1 billion of revenue in 2024.
Frustration mounts as Ohio Statehouse tackles property reliefAccording to the Tax Foundation, retaliatory tariffs by foreign governments on imported goods are likely. The foundation said this would not be a direct tax on exports, but it would raise prices for consumers buying American goods in foreign markets, which would affect U.S. sales abroad. Retaliatory tariffs on semiconductors could easily complicate things for Intel, a company that has faced financial struggles and relies heavily on revenue from abroad.
Representatives for the Semiconductor Industry Association, which calls itself the voice of the U.S. semiconductor industry, declined to add anything to this report. However, the Association released a sample policy agenda with recommendations for Trump to advance U.S. semiconductor manufacturing. It made five recommendations on how to improve global economic security through trade and supply chain actions and had three recommendations for out-competing China, none of which recommended tariffs.
If tariffs were to further financial problems for Intel, its New Albany plant may see cuts. During the company's financial update announcement, co-interim CEO Michelle Johnson Holthaus said the division responsible for semiconductor manufacturing would need to "earn her business" everyday, implying its future is not guaranteed. Her co-interim CEO spoke about the semiconductor portion more confidently.
There are clauses in state and federal funding that would allow government funding to be taken back if they go unmet, which provide some protections for the Ohio Intel plant. Intel recently told NBC4 it does not have any updates to the plant at this time, and its final super load delivery to the site docked Sunday, so construction continues.
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