New US 100pc chip tariff will not apply to EU, WSJ reports

An EU spokesperson said that the 15pc levy will apply irrespective of any other tariffs imposed.

The European Union has said that it will not face the new roughly 100pc tariff on semiconductors that US president Donald Trump announced yesterday (6 August).

“We’re going to be putting a very large tariff on chips and semiconductors,” the president announced on Wednesday at the Oval Office.

“But the good news for companies like Apple is if you’re building in the United States or have committed to build, without question, committed to build in the United States, there will be no charge.”

His comments come just as Apple announced an additional $100bn worth of investment in US manufacturing. This is on top of the $500bn the company already announced earlier this year.

“So in other words, we’ll be putting a tariff of approximately 100pc on chips and semiconductors,” he added. However, no formal tariff announcement with this addition has been made yet and it is unclear how many companies could be affected.

Companies such as TSMC and Samsung are also set to evade the new tariffs, having made ongoing commitments to invest in US manufacturing.

Back in the EU, Olof Gill, the spokesperson for trade and economic security matters for the European Commission told the Wall Street Journal today (7 August) that the EU is exempt from the 100pc levy.

The US had made a commitment that the agreed upon 15pc tariff will apply to EU semiconductor exports, irrespective of levies imposed on other regions, he told the publication. “We look forward to the US implementing this commitment.”

SiliconRepublic.com has reached out to the Commission to confirm the spokesperson’s statement.

Two weeks ago, Trump and EU commission president Ursula von der Leyen reached an agreement on a single 15pc tariff on most EU exports to the US.

“This rate applies across most sectors, including cars, semiconductors and pharmaceuticals. This 15pc is a clear ceiling. No stacking. All inclusive,” von der Leyen said at the time.

“So it gives much-needed clarity for our citizens and businesses. This is absolutely crucial.”

Trump’s latest threat comes just after his “reciprocal tariffs” went into effect all over the world on 1 August. Major trading partners such as the EU, South Korea and Japan face a 15pc tariff, while semiconductor hub Taiwan sees a 20pc levy.

Harder hit are countries such as Brazil – whose president is increasingly at odds with Trump – which faces a 50pc levy. While India recently saw its tariffs doubled to 50pc after it refused to back down from trading with Russia. The new 25pc addition will take effect later this month.

China, on the hand, is facing a 30pc tariff, a significant reduction compared to the nearly 150pc levy that Trump handed country back in April.

Don’t miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic’s digest of need-to-know sci-tech news.