President Donald Trump said on Tuesday that he threatened Taiwan Semiconductor Manufacturing Company with a “big tax” of up to 100% if the chip maker didn’t build their plants in America.
Trump was speaking at a dinner event organized by the Republican National Congressional Committee when he criticized the bipartisan CHIPS Act, which President Joe Biden signed in 2022.
“These chip companies are loaded. They give these companies billions of dollars to build a plant in the United States. They don’t build them in the US,” Trump said in his remarks on Tuesday.
The Biden administration said in November that it had awarded TSMC up to $6.6 billion in funding to build three chip factories in Phoenix. TSMC’s first factory in Phoenix faced construction delays initially but started producing chips last year.
Last month, TSMC said it would invest $100 billion to build five new chip factories in the US. The company said the investment was on top of the $65 billion it announced in April 2024.
Trump said on Tuesday that he had convinced TSMC to deepen its manufacturing footprint in the US without offering more funding.
“All I did is say, ‘If you don’t build your plant here, you are gonna pay a big tax. 25, maybe 50, maybe 75, maybe 100%,'” Trump said.
TSMC declined to comment when approached by Business Insider.
Trump has threatened companies with tariffs in the past. While on the campaign trail in September, Trump said he would impose a 200% tariff on John Deere if the agriculture equipment company moved its manufacturing to Mexico.
Last week, Trump announced a slate of reciprocal tariffs on over 180 countries. The tariffs, which start at a baseline rate of 10%, took effect on Wednesday.
Commerce Secretary Howard Lutnick said on Thursday that while the tariffs didn’t apply to semiconductors, Trump is still thinking about how he can restore the US’s foothold in chip making.
“Donald Trump’s going to deeply study those. And those are going to come later on how to reshore from Taiwan all that semiconductor manufacturing,” Lutnick said. “We have to protect ourselves at some point. America has to be able to protect itself.”
Representatives for the White House did not respond to a request for comment from BI.
