President Donald Trump has announced a 25% tariff on certain advanced AI chips from Nvidia and AMD, allowing their export to China while claiming a share of the sales revenue. The policy reverses a prior export ban on Nvidia's H200 chips but imposes the levy to fund US interests. Industry executives view it as a way to shield the arrangement from legal challenges.
On January 15, 2026, US President Donald Trump signed a proclamation imposing a 25% tariff on advanced computing chips imported into the United States and then re-exported abroad, particularly targeting sales to China. The measure affects Nvidia's H200 and AMD's MI325X processors, which are manufactured by Taiwan Semiconductor Manufacturing Company (TSMC) in Taiwan.
This policy builds on a December decision by the White House to permit Nvidia to ship H200 chips to China, reversing an earlier prohibition on advanced AI hardware exports. In exchange, the US government will take 25% of the sales value. Trump described the deal during an Oval Office statement: “We’re going to be making 25 percent on the sale of those chips, basically. So we’re allowing them to do it, but the United States is getting 25 percent of the chips in terms of the dollar value. And I think it’s a very good deal.”
The tariffs, enacted under Section 232 national security provisions, exempt chips imported for domestic US use, such as building AI infrastructure or data centers. They form part of Trump's broader trade strategy, which includes threats of up to 100% tariffs on semiconductors unless companies invest in US manufacturing. Nvidia has pledged $500 billion over four years for domestic production, while TSMC is investing $165 billion in Arizona facilities, where it began producing Nvidia's Blackwell chips in October 2025.
Nvidia welcomed the move, stating it “strikes a thoughtful balance that is great for America.” AMD affirmed compliance with US export laws. However, China's response remains uncertain; officials recently instructed logistics firms not to process H200 import requests, amid Beijing's push for domestic chip self-sufficiency. Tech firms like Alibaba, ByteDance, and Tencent favor the H200 for its performance.
The administration warned of potential broader tariffs on semiconductors following a ongoing national security probe, signaling continued tensions in global tech supply chains.
