US President Donald Trump on Wednesday signed a proclamation imposing a 25 per cent tariff on specific advanced artificial intelligence semiconductors, including Nvidia’s H200 and AMD’s MI325X chips.
The new tariff applies to certain high-end chips manufactured outside the United States that transit through the country before being exported to overseas customers. The move formalises a recent decision by the US Department of Commerce that allowed Nvidia to ship its H200 chips to vetted buyers in China, while ensuring the US government receives a portion of the revenue generated from such exports.
Nvidia welcomed the decision, with a company spokesperson praising the administration’s approach. “We applaud President Trump’s decision to allow America’s chip industry to compete,” the spokesperson said, adding that the policy supports high-paying US jobs and strikes a “thoughtful balance” by permitting sales of the H200 to authorised commercial customers.
Strong global demand for advanced AI chips continues to fuel the market, with reports indicating that Nvidia may ramp up production to meet early orders from Chinese firms. However, companies may face regulatory challenges in China, where authorities are drafting new rules to restrict the volume of foreign semiconductor purchases as part of efforts to strengthen domestic chip manufacturing.
The proclamation cites national security concerns, noting that the United States currently produces only about 10 per cent of the semiconductors it requires. “This dependence on foreign supply chains is a significant economic and national security risk,” the document states.
The order specifically targets chips exported after passing through the US, while exempting those imported for domestic use in American research, defence, or commercial sectors.
