U.S. Slaps 25% Tariff on Nvidia's China-Bound H200 AI Chips

Following months of speculation about potential tariffs on semiconductors, the Trump administration has announced duties targeting specific chips. The new tariff applies to certain semiconductors, including the advanced Nvidia H200 AI chips slated for shipment to China.

On Wednesday, President Donald Trump signed a proclamation instituting a 25% tariff on advanced AI semiconductors manufactured outside the United States that transit through the U.S. before being exported to customers abroad.

This move formalizes a key part of the U.S. Department of Commerce's decision to permit Nvidia to begin shipping its H200 advanced AI chips to pre-approved customers in China this December. The tariff also affects chips from other companies, such as the AMD MI325X.

Despite the new tariff, Nvidia publicly welcomed the decision, which enables it to sell the chips to authorized customers.

"We applaud President Trump's decision to allow America's chip industry to compete, supporting high-paying jobs and domestic manufacturing. Providing the H200 to vetted commercial customers, as approved by the Department of Commerce, represents a balanced approach that benefits America," an Nvidia spokesperson told TechCrunch via email.

Demand for these H200 semiconductors is strong. Reports indicate Nvidia considered increasing production due to a surge of early orders from Chinese companies.

However, demand is only one part of the equation. The other critical factor is how the Chinese government chooses to regulate these imports.

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China finds itself in a position both similar to and distinct from the U.S. in the global semiconductor production and AI race. The country aims to strengthen its domestic chip industry but is also wary of falling behind as it waits for its homegrown technology to compete with international leaders.

According to reports from Nikkei Asia, the Chinese central government is drafting rules to limit how many semiconductors domestic companies can buy from overseas. This would permit some purchases of Nvidia's chips, marking a shift from the country's current restrictive stance on such imports.

The executive order signed on Wednesday does not apply to chips imported into the U.S. for domestic use in research, defense, or commercial applications.

"The United States currently manufactures only about 10% of the semiconductors it needs, creating a heavy reliance on foreign supply chains. This dependence poses a substantial risk to both economic and national security," the proclamation stated.