Section 232 Semiconductor Tariffs Could Undermine US Growth

The Trump administration began implementing a new round of Section 232 tariffs on semiconductors, semiconductor machinery, and downstream technology goods in January 2026.

• Main action: The administration imposed a 25 percent tariff in the first phase and is planning a second phase expected to sharply raise tariff rates and introduce a tariff offset program to reward firms investing in U.S. semiconductor manufacturing; ITIF quantifies impacts including 0.2% GDP growth loss (~$58 billion) in year 1 and $1.6 trillion cumulative GDP loss over 10 years for a 25% tariff (and up to $122 billion year-1 / $4.4 trillion over 10 years under a 50% tariff).
• Background/details: The piece notes RAM prices surged 90% in Q1 2026, the United States accounts for just 12 percent of global semiconductor production, many domestic fabs are years away from operation, eligibility and implementation of the offset program remain unclear, and the authors recommend the administration remove the 25 percent tariff or abandon semiconductor tariffs altogether.