Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, will be exempt from the newly announced 100% U.S. tariff on semiconductor imports, Taiwan’s government confirmed Thursday. The news sent TSMC shares surging to an all-time high and boosted investor sentiment across Taiwan’s stock market.
As reported by Bloomberg, Liu Chin-ching, head of Taiwan’s National Development Council, announced that TSMC’s significant investment in the United States qualifies it for exemption from the harsh new trade measures. “TSMC is exempted from the chip tariffs because it has set up plants in the U.S.,” Liu said at a press briefing in Taipei.
The announcement comes a day after former U.S. President Donald Trump declared plans to impose a sweeping 100% tariff on imported semiconductors. However, Trump noted that companies manufacturing within the U.S. — such as Apple and TSMC — would not be subject to the levy. “If you’re building in the United States of America, there’s no charge,” Trump said.
TSMC has committed a total of $165 billion to build three fabrication plants, advanced packaging facilities, and a research center in Arizona. This extensive investment has shielded it from the brunt of the tariff crackdown and helped reassure global markets already on edge over escalating trade tensions.
The Taiwanese government also said it is in active negotiations with Washington to discuss the broader tariff policy and its long-term implications. Despite the uncertainty, Taiwan’s economy is projected to grow by 3.1% in 2025, buoyed by strong technology exports and continued semiconductor demand.
“The exemptions for Taiwan’s largest company have allayed concerns,” said Khoon Goh, head of Asia research at Australia & New Zealand Banking Group, in comments reported by Bloomberg. “Foreign equity inflows on the back of this news have helped push the Taiwan dollar stronger.”
Indeed, the Taiwan dollar rose as much as 0.6% to 29.808 against the U.S. dollar — its strongest level in a week — following the announcement. TSMC, which alone accounts for nearly 40% of Taiwan’s benchmark stock index, drove the market rally with its record performance.
United Microelectronics Corp. (UMC), Taiwan’s second-largest chipmaker, may also mitigate the impact of the tariffs through its collaboration with U.S.-based Intel Corp., according to Liu.
Still, questions linger over how the tariffs will affect the broader semiconductor supply chain. While South Korea’s Samsung and Apple are expected to avoid the levies due to their U.S.-based operations, other major players — including Malaysia — are scrambling for clarity. Malaysia’s government said Thursday it had reached out to the U.S. for guidance on the policy, underscoring the global ripple effects of the announcement.
Although the U.S. recently imposed a 20% tariff on goods from Taiwan — a higher rate than Japan and South Korea’s 15% — the chip sector is being treated as a special case, at least for now.
With semiconductor geopolitics heating up, Taiwan’s ability to maintain its edge appears tied not just to technological innovation, but also to strategic global investments — a bet that, for TSMC, seems to be paying off.
