The topsy-turvy-tariff tale continued to swing this week, as the Trump administration advanced a plan on Monday that could result in new levies on semiconductors and pharmaceuticals. The news came days after US President Donald Trump announced that smartphones would be exempt from the 145% duty that he had slapped on China.
Officially, the plan involves a first step of investigating the national security implications of importing pharma and semiconductors. The next step would be to invoke Section 232 of the 1962 Trade Expansion Act, which allows a president to impose tariffs in the interests of protecting national security. As such, the means for this latest slate of levies would be different from the widescale duties announced on “liberation day.”
Countries affected. The United States relies heavily on Taiwan in particular for semiconductors — one plant there crafts 92% of the world’s advanced chips. As for pharmaceuticals, the US imports many from China, Ireland, and India.
All that and a bag of CHIPS. Former President Joe Biden tried to spark the US’s own semiconductor industry with the 2022 CHIPS and Science Act, which allocated $53 billion for domestic semiconductor manufacturing. Trump said last month he wanted to “get rid of” the CHIPS Act, yet his more recent actions suggest he’s interested in leveraging the law to further his plan to reduce US reliance on foreign chips.Prime Minister Narendra Modi, with President of the European Council António Luís Santos da Costa, and President of the European Commission Ursula von der Leyen, at Hyderabad House, in New Delhi, India, on Jan. 27, 2026.
On Tuesday, the world’s largest single market and the world’s most populous country cinched a deal that will slash or reduce tariffs on the vast majority of the products they trade.
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