U.S. to Hit Chinese Chips With New Tariffs in 2027
By Du Zhihang
The U.S. plans to hike tariffs on Chinese semiconductors starting in June 2027, granting importers an 18-month window before levying new duties resulting from a probe into Beijing’s industrial policies.
The Office of the U.S. Trade Representative (USTR) announced Tuesday local time that the levies will take effect on June 23, 2027, following a Section 301 investigation. The specific tax rates are expected to be published no later than one month prior to implementation.
The decision marks the latest escalation in Washington’s efforts to decouple from Chinese technology supply chains, citing Beijing’s state-driven pursuit of dominance in the semiconductor sector as a threat to American economic security.
China’s foreign ministry spokesperson Lin Jian responded on Wednesday, stating that Beijing “firmly opposes” the move.
“The U.S. practice destabilizes global industrial and supply chains, stifles other countries’ semiconductor industry, and serves no one’s interests,” Lin said at a regular press briefing. He urged Washington to correct its course and warned that China would take corresponding measures to protect its legitimate rights if the U.S. persists.
The announcement concludes a year-long investigation launched by the USTR on Dec. 23, 2024, which examined the use of Chinese semiconductors in critical U.S. sectors including defense, automotive, medical equipment and telecommunications. The USTR stated that it had sought consultations with the Chinese government, but Beijing refused to engage within the framework of the U.S. Trade Act.
The USTR justified the tariffs by labeling China’s push for semiconductor dominance as “unreasonable” and a burden on U.S. commerce. The agency alleged that China has employed aggressive non-market policies for decades to corner the market, creating economic security risks due to reliance on Chinese supply chains.
The new duties will be imposed in addition to the existing 50% Section 301 tariffs. The expanded scope covers a wide range of components, including pure silicon, diodes, transistors and photosensitive semiconductors, as well as integrated circuits used for memory, amplification and processing.
The U.S. currently levies a 60% total tax on Chinese semiconductors. Following a previous review, the White House announced in May 2024 that tariffs on Chinese chips would double from 25% to 50% by 2025. While the current U.S. administration enforces a broad 20% tariff on Chinese goods — comprising a 10% levy related to fentanyl and a 10% “reciprocal tariff” from President Donald Trump — semiconductors have been exempted from the reciprocal portion.
Leading up to the decision, organizations including the U.S. Semiconductor Industry Association (SIA), South Korean wafer manufacturer SK Siltron CSS and China’s Geely Automobile Holdings Ltd. submitted feedback to the USTR. The SIA noted that while global capacity for mature-node chips grew by 41.6% between 2015 and 2023, more than half of that expansion was concentrated in China. The association had advised the USTR to proceed with caution.
The combination of tariffs and export controls has already significantly reduced U.S. imports of Chinese chips. The value of semiconductor imports from China fell from $3.88 billion in 2018 to $2.09 billion in 2024, with China’s share of total U.S. chip imports shrinking from 10.33% to 4.49% over the same period.
Contact editor Wang Xintong (xintongwang@caixin.com)
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