The Trump administration is reportedly considering new semiconductor tariffs, raising concerns among tech companies about the potential impact on U.S. leadership in AI.
The proposed tariff plan could drastically widen the scope of tech products subject to duties. This could potentially affect goods manufactured with semiconductors, including laptops, gaming consoles, and servers used in data centers, POLITICO reported on Thursday.
Commerce Secretary Howard Lutnick is in favor of a system that ties foreign companies’ tariff relief to their investment in U.S. chip production, with the aim of boosting domestic manufacturing, as per the report.
The administration is also contemplating a phase-in period for the new tariffs. However, the framework may undergo significant changes in the coming weeks or months.
Tech companies have begun lobbying efforts to convince the Trump administration to soften the expected tariffs, arguing that the duties would obstruct data center expansion by making it difficult for U.S. companies to procure the volume of semiconductors needed for the AI boom, according to the report.
White House did not immediately respond to Benzinga’s request for comments.
Proposed Tariffs Could Put Big Tech AI Plans At Risk
The suggested tariffs could affect American tech giants’ unprecedented AI spending spree, which includes substantial investments in data center mega-campuses and the acquisition of high-end chips necessary for their operation, as per experts.
Jonathan McHale of the Computer and Communications Industry Association told POLITICO that the tariffs could jeopardize massive U.S. data center investments by raising costs and creating uncertainty, comparing the buildout’s scale to the transcontinental railroad.
"Anytime you add to the cost and decrease predictability, you make it more difficult to invest, and you are putting that in jeopardy,” McHale warned.
Notably, this report comes after a recent analysis found that the U.S. has surpassed China in new gas-fired power plant construction, largely fueled by soaring electricity demand from AI data centers. Gas projects under construction in the U.S. rose 76% in the first half of the year, raising concerns that completing the planned projects could significantly increase greenhouse gas emissions.
Earlier this year, the administration was reported to be considering broad chip tariffs while also planning exemptions to protect big tech companies like Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corp (NASDAQ:MSFT) and Alphabet Inc.‘s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google from higher chip costs. These exemptions were aimed at supporting the companies’ AI expansion efforts.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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