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On December 23, 2025, the U.S. Trade Representative (USTR) announced new tariffs on Chinese semiconductors under Section 301 of the Trade Act of 1974. Notably, the USTR set the initial rate of these tariffs at 0%. This will increase on June 23, 2027 to a rate that will be announced in the future.
By specifying a rate to be announced in the future, the USTR notice allows President Donald J. Trump to adjust the rate in response to the upcoming expiration of the existing trade truce, which was negotiated last fall.
These new Section 301 tariffs will stack upon existing Section 301 tariffs on Chinese semiconductors, originally introduced on August 23, 2018 following a separate USTR investigation into forced Chinese technology transfers. Those existing Section 301 tariffs are currently in effect with a tariff rate of 50%.
1. Background
The announcement is the result of a Section 301 investigation, initiated on December 23, 2024, into China's adoption of anticompetitive and non-market policies targeting the semiconductor industry for dominance.
The tariffs announced in December 2025 are the first new duties on China announced since President Trump concluded a trade agreement with China on November 1, 2025. That agreement established a one year truce on escalating trade restrictions, and resulted in the suspension of some tariff and non-tariff actions on China until November 2026, as discussed in our recent blog post. USTR's decision to set the additional tariff rate at 0% avoids disrupting the current truce.
2. History of Section 301 Tariffs on Chinese Semiconductors
On August 18, 2017, the USTR originally initiated a Section 301 investigation into forced Chinese technology transfers. This investigation resulted in a 25% tariff on Chinese semiconductors, which took effect August 23, 2018.
In response to a USTR review of those tariffs, then-President Joseph R. Biden directed an increase in the Section 301 semiconductor tariff rate to 50%. The increase took effect on January 1, 2025, affecting Chinese semiconductors and related components classified under 18 separate Harmonized Tariff Schedule (HTS) subheadings (to include high purity silicon, diodes, transistors, transducers, and integrated circuits).
That 50% Section 301 tariff rate stacks on top of the 20% tariff applied to Chinese products under the International Emergency Economic Powers Act (IEEPA), unless certain exemptions apply.
3. New Tariff Rates and Scope
The recently announced Section 301 tariffs, set to take effect June 23, 2027, will apply to the same set of 18 HTS subheadings already subject to 50% Section 301 tariffs, listed below.
| Tariff Code | HTS Description |
|---|---|
| 28046100 | Silicon containing by weight not less than 99.99 percent of silicon. |
| 38180000 | Chemical elements doped for use in electronics, in the form of discs, wafers etc., chemical compounds doped for electronic use. |
| 85411000 | Diodes, other than photosensitive or light-emitting diodes. |
| 85412100 | Transistors, other than photosensitive transistors, with a dissipation rating of less than 1 W. |
| 85412900 | Transistors, other than photosensitive transistors, with a dissipation rating of 1 W or more. |
| 85413000 | Thyristors, diacs and triacs, other than photosensitive devices. |
| 85414910 | Other photosensitive semiconductor diodes, other than light-emitting. |
| 85414970 | Photosensitive transistors. |
| 85414980 | Photosensitive semiconductor devices nesoi, optical coupled isolators. |
| 85414995 | Other photosensitive semiconductor devices, other than diodes or transistors, nesoi. |
| 85415100 | Other semiconductor-based transducers, other than photosensitive transducers. |
| 85415900 | Other semiconductor devices, other than semiconductor-based transducers, other than photosensitive devices, nesoi. |
| 85419000 | Parts of diodes, transistors, similar semiconductor devices, photosensitive semiconductor devices, LED's and mounted piezoelectric crystals. |
| 85423100 | Electronic integrated circuits: processors and controllers. |
| 85423200 | Electronic integrated circuits: memories. |
| 85423300 | Electronic integrated circuits: amplifiers. |
| 85423900 | Electronic integrated circuits: other. |
| 85429000 | Parts of electronic integrated circuits and microassemblies. |
As a result, importers currently subject to these tariffs should be prepared to pay a higher rate as of June 23, 2027. The USTR notice states the additional Section 301 duty rate will be announced no later than May 24, 2027, without providing additional specifics on process.
As currently codified in the HTS, the additional tariff will not apply to derivative articles (e.g., consumer electronics) containing semiconductors.
4. Other Potential Tariffs on the Horizon?
This announcement is not the only possible tariff affecting the semiconductor industry. As noted in our previous blog post, the U.S. Department of Commerce may also implement tariffs following the conclusion of its ongoing Section 232 investigation into semiconductors. Based on the application of the Section 232 tariff on steel and aluminum derivatives, if any downstream products becomes covered by this Section 232 investigation, importers may potentially need to pay a duty for those finished products based on the value of the incorporated semiconductors.
UPDATE: On January 14, 2026, President Trump issued a Proclamation imposing a Section 232 tariff of 25 percent on certain semiconductors. Downstream products are not currently affected.
4. Next Steps and Possible Outcomes
The announcement of additional Section 301 tariffs on semiconductors provides President Trump with another bargaining chip in future trade talks with China. Those negotiations will almost certainly occur prior to November 2026, when the existing trade truce negotiated last fall is set to expire.
By providing for "a rate to be announced", the USTR notice gives President Trump the flexibility to set the rate higher or lower pending the outcome of future trade talks.
Importers currently subject to Section 301 semiconductor tariffs should monitor the progress of trade negotiations with China closely through 2026, as a breakdown in negotiations would likely result in higher tariff rates.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
