It looks like the U.S. is about to make a serious move in semiconductor manufacturing. The Wall Street Journal reported on Friday that the U.S. is planning to ask chipmakers to manufacture at home as many semiconductors as their customers import, aiming to curb reliance on overseas supply.
The Trump administration would levy tariffs on firms that do not sustain a 1:1 ratio over time, the report said, citing people familiar with the plan.
“America cannot be reliant on foreign imports for the semiconductor products that are essential for our national and economic security,” the newspaper cited White House spokesperson Kush Desai as saying, adding that any reporting about policymaking should be treated as speculative, unless officially announced.
In 2025, Trump has made semiconductor manufacturing a central focus of his economic agenda, aiming to reduce U.S. reliance on foreign chip production and bring manufacturing back to American soil. His administration has proposed aggressive trade measures, including a potential 100% tariff on imported semiconductors. However, companies that commit to building manufacturing capacity in the U.S. could be exempt.
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To further incentivize domestic production, the administration is expanding tax breaks for companies that build advanced semiconductor facilities in the U.S. Also, supposed provisions in Trump’s informally dubbed the “Big Beautiful Bill,” would raise the investment tax credit for chipmakers from 25% to 35%, rewarding those who meet domestic production targets by a 2026 deadline. These credits are intended to offset the massive cost of building cutting-edge fabs, which can exceed $10 billion per site.
Large companies like TSMC, Apple, and Nvidia have already announced significant new U.S. investments, with TSMC committing over $100 billion to expand its Arizona operations, including advanced packaging and manufacturing.
At the same time, Trump has taken a skeptical stance toward the CHIPS and Science Act, a bipartisan law passed in 2022 that allocated over $52 billion for semiconductor subsidies and research. He has proposed eliminating parts of the CHIPS Act, particularly its grant programs, arguing that direct subsidies are inefficient and contribute to government overspending. Instead, he prefers market-driven incentives such as tax cuts and tariffs.
Reports also suggest staff reductions in government offices overseeing CHIPS Act implementation, signaling a broader policy shift away from direct industrial subsidies.
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While the policy is bold, it comes with risks and uncertainties. High tariffs could also disrupt global chip supply chains and strain trade relations, especially with Asian manufacturing hubs like Taiwan and South Korea.
By combining high tariffs, production mandates like the proposed 1:1 rule, and expanded tax incentives, the policy aims to realign global supply chains and restore American dominance in a sector critical to both economic competitiveness and national security. This shift reflects growing concerns over the vulnerability of relying on foreign chipmakers, particularly amid rising geopolitical tensions.
While the strategy may accelerate investment in the U.S.-based production, it also introduces uncertainties for global trade partners and challenges for companies adjusting to new regulations. The long-term success of the plan will depend on the U.S. industry’s ability to scale manufacturing quickly, attract skilled talent, and maintain technological leadership. Regardless of political outcomes, the message is clear: the U.S. is preparing to play a more assertive, self-reliant role in the future of semiconductor production.