Polysilicon Tariff Storm! Government: Solar Exports Only 1%, Impact Limited; Semiconductor Sector Protected by MOU

On August 6 (U.S. Eastern Time), U.S. President Donald Trump signed a presidential proclamation imposing a 15% tariff on imported polysilicon and its derivative products from all countries, effective December 4, 2026, along with establishing a minimum import price mechanism. Taiwan's Administration-led U.S.-Taiwan Economic and Trade Working Group stated that, based on preliminary assessments, Taiwan's solar industry is primarily domestic-market oriented, with exports accounting for only 1% of total output, thus the impact is expected to be limited. Additionally, Taiwan's semiconductor silicon wafer manufacturers, having already invested in the U.S., are eligible for tariff-exempt quotas and exemptions on raw materials, equipment, and components under the U.S.-Taiwan Investment Cooperation MOU.

According to the U.S. announcement, the Department of Commerce determined that polysilicon is a core material for both the semiconductor and solar industries. However, the U.S. share of global polysilicon production capacity has declined to extremely low levels in recent years, posing threats to economic and national security. Therefore, a 'minimum import price' mechanism has been established. Imports priced below this threshold will incur additional duties to bridge the gap to the minimum price. The specified minimum prices are $21/kg for polysilicon, $100/kg for ingots and wafers, $0.22/W for solar cells, and $0.38/W for solar modules.

The U.S. further stated that if trade partners with agreements with the U.S. implement import adjustment measures that have substantially equivalent effects to the U.S. minimum import price system, the U.S. Department of Commerce and Office of the U.S. Trade Representative may adjust the applicable minimum import prices and Section 232 tariffs for those partners.

The announcement imposes a 15% tariff on polysilicon ingots and derivative products listed in the annex across all countries, while granting Taiwan, Japan, South Korea, and the EU a 15% rate without叠加 Most Favored Nation (MFN) tariffs. The policy also encourages foreign companies to invest in polysilicon and derivative production facilities in the U.S., allowing manufacturers to be exempt from Section 232 tariffs on related production equipment and the newly taxed products during the construction phase, based on investment scale.

Regarding the semiconductor industry, the U.S.-Taiwan Economic and Trade Working Group reported that Taiwan's polysilicon product exports to the U.S. amount to approximately $320 million, representing 25% of Taiwan's total global exports of such products. Of this, silicon wafer exports to the U.S. totaled $252.1 million, primarily supplying U.S. semiconductor manufacturers. Under the U.S.-Taiwan Investment Cooperation MOU, Taiwanese semiconductor-related industries investing in the U.S. benefit from tariff-exempt quotas and customs exemptions for raw materials, equipment, and components required for factory setup and operations. A government-to-government (G2G) communication mechanism has been established to advance the investment MOU, and the government will continue assisting Taiwanese companies in negotiating with U.S. authorities to confirm exempted items and preferential treatments, ensuring Taiwan's semiconductor supply chain advantages remain intact.

For the solar industry, Taiwan's photovoltaic sector is predominantly domestic-focused, with exports to the U.S. mainly consisting of solar cell components and modules valued at $33.5 million. With the projected output value of Taiwan's solar industry reaching NT$108.2 billion in 2025, exports account for only about 1%, classifying it as a domestic-demand-driven industry. Thus, the impact of this measure is assessed as limited. The government will continue supporting relevant enterprises investing in the U.S. to secure exemption benefits, reducing investment and operational costs and enhancing international competitiveness.