The US imposes a 25% tariff on Nvidia H200 AI chips destined for China

After months of rumors that the Trump administration was going to impose tariffs on semiconductors, tariffs on some chips have been announced. The tariff applies only to certain semiconductors, including advanced Nvidia H200 AI chips scheduled to be shipped to China.

President Donald Trump signed a proclamation on Wednesday that includes a 25% tariff on advanced artificial intelligence semiconductors that are produced outside the United States and then pass through the United States before being exported to customers in other countries.

This news formalizes a key element of the US Commerce Department’s decision to give Nvidia the green light to begin shipping its advanced H200 AI chips to vetted customers in China in December. It also includes chipsets from other companies, including the AMD MI325X.

Despite the tariffs, Nvidia publicly welcomed the move, allowing it to sell the chip to authorized customers.

“We applaud President Trump’s decision to allow the U.S. chip industry to compete to support high-wage jobs and manufacturing in America. Offering the H200 to approved commercial customers, vetted by the Commerce Department, strikes a thoughtful balance that is great for America,” an Nvidia spokesperson emailed TechCrunch.

There is demand for H200 semiconductors. Nvidia was reportedly considering increasing production of these chips due to a rush of early orders from Chinese companies.

Demand is just one factor though. The other is how the Chinese government decides to regulate these imports.

China finds itself in a similar but different situation than the United States when it comes to chip production and the global AI race. China wants to boost its domestic semiconductor industry, but the country also doesn’t want to be left behind while it waits for its domestic technology to catch up with international competitors.

China’s central government is drafting rules and guidelines on how many semiconductors Chinese companies can buy from abroad, according to reports from Nikkei Asia. This would allow for some purchasing of Nvidia chips and would be a reversal from the country’s current plight with chip imports.

Wednesday’s executive order does not apply to chips that are imported into the United States and then used in the country for research, defense or commercial purposes.

“The United States currently manufactures only approximately 10% of the chips it needs, making it highly dependent on foreign supply chains. This reliance on foreign supply chains poses a significant risk to the economy and national security,” the announcement said.