If Trump's new threat of massive 100% tariffs on chips from Taiwan comes true an RTX 5090 for $2,000 will seem cheap
If $2,000 for Nvidia's toasty new RTX 5090 graphics card feels a little steep, things might be about to get a whole lot more expensive. Speaking to Republicans at a conference in Miami on Monday, President Trump threatened to impose up to 100% tariffs on chips from Taiwan.
«In the very near future, we’re going to be placing tariffs on foreign production of computer chips, semiconductors and pharmaceuticals to return production of these essential goods to the United States of America,” Trump said.
It is of course TSMC in Taiwan that makes many of world's most advanced chips, including both Nvidia's outgoing RTX 40 GPUs and the new RTX 50 family.
Trump's justification for the move involves incentives to force chip designers like Nvidia and indeed its rival AMD to produce more of their products in the US. „They needed an incentive. And the incentive is gonna be they’re not gonna wanna pay a 25, 50 or even a 100% tax,“ Trump said.
He also clearly called out Taiwan as his chief target. „They left us and went to Taiwan, which is about 98% of the chip business,“ he said.
Trump argued that tech companies will build new chip production factories or fabs in the US in order to avoid paying the tariffs. Whether that would indeed be the case, what is certain is that it takes many years to construct a new fab and have it producing chips at decent yields.
That process takes even longer if you're talking absolute cutting-edge chip production. That means the Trump administration is in a tricky spot if it wants to impose tariffs.
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If it does so in the near term, there won't be time for those fabs to be built and come online, so costs will go up for chip makers, in turn amplifying the risk that prices for consumers in the US increase.
A possible alternative is to set a future date for tariff imposition. The problem with that approach is that term limits for presidents in the US
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