Trump Imposes New Tariffs Again! U.S. Announces Section 232 Investigation on Semiconductor Polysilicon Products; Executive Yuan Preliminarily Estimates Limited Impact

Following the recent release of findings from the U.S. Trade Representative (USTR) under Section 301, President Donald Trump has again signed a presidential proclamation, announcing results from an investigation under Section 232 of the Trade Expansion Act of 1962. Starting December 4, 2026, a 15% tariff will be imposed on polysilicon (Polysilicon) and its derivative products imported from all countries, including those used in solar energy and semiconductors. Taiwan, Japan, South Korea, and the European Union (EU) will be subject to a 15% non-cumulative Most Favored Nation (MFN) tariff rate. In response, the Executive Yuan’s Taiwan-U.S. Economic and Trade Working Group issued a press release this afternoon (7th).

After the legal basis for U.S. reciprocal tariffs expired, the USTR temporarily applied a 10% global tariff under Section 122 of the Trade Act of 1974, which was cumulative with existing MFN rates, but this measure expired on July 24. To rebuild the legal foundation for tariffs, the U.S. simultaneously initiated investigations under Section 301 of the same act regarding 'forced labor' and 'structural overcapacity,' recently releasing findings on banning imports of forced labor products. Taiwan and the EU received a 10% non-cumulative MFN tariff rate—slightly more favorable than the 12.5% applied to major competitors like Japan and South Korea.

Trump Signs Section 232 Findings: 15% Tariff on Polysilicon Products

On August 6 (U.S. Eastern Time), President Trump signed a presidential proclamation based on the Section 232 investigation under the Trade Expansion Act of 1962. Starting December 4, 2026, a 15% tariff will be imposed on polysilicon and its derivatives from all countries, covering solar and semiconductor-related polysilicon products, and establishing a Minimum Import Price (MIP) mechanism.

According to the Taiwan-U.S. Economic and Trade Working Group, the U.S. Department of Commerce determined that polysilicon is a core raw material for the semiconductor and solar industries. However, the U.S. share of global polysilicon production capacity has declined to extremely low levels, posing threats to U.S. economic and national security. Hence, a 'Minimum Import Price' mechanism will be implemented—imports below this threshold will face additional duties to meet the minimum price. The U.S. also stated that if treaty partners implement equivalent import adjustment measures, the U.S. may adjust the MIP and Section 232 tariffs applicable to them.

The Working Group noted that the proclamation applies a 15% tariff to polysilicon ingots and derivative products listed in the annex, with Taiwan, Japan, South Korea, and the EU receiving the 15% non-cumulative MFN rate. Additionally, the U.S. encourages foreign enterprises to invest in polysilicon and derivative production facilities within the U.S., allowing manufacturers to be exempt from the Section 232 tariffs on production equipment and affected products during construction, based on investment scale.

Economic and Trade Working Group: Initial Assessment Indicates Limited Impact

Regarding the semiconductor industry, the Taiwan-U.S. Economic and Trade Working Group stated that Taiwan’s polysilicon product exports to the U.S. amount to approximately $320 million, representing 25% of global exports of such products. Of this, silicon wafer exports to the U.S. total $252.1 million, primarily supplying U.S. semiconductor firms. Under the already-signed Taiwan-U.S. Investment Cooperation MOU, Taiwanese semiconductor-related investments in the U.S. enjoy tariff-exempt quotas, along with duty exemptions on raw materials, equipment, and components needed for U.S. plant construction and operations. A government-to-government (G2G) communication mechanism has been established under the MOU, and the government will continue assisting Taiwanese firms in negotiating recognition of exempted items and preferential treatments with U.S. counterparts, ensuring Taiwan’s semiconductor supply chain advantages remain unaffected.

For the solar energy sector, the Working Group analyzed that Taiwan’s photovoltaic industry is primarily domestic-market oriented, with exports to the U.S. mainly consisting of solar cells and modules valued at $33.5 million. With the projected 2025 output value of Taiwan’s solar industry at NT$108.2 billion, exports account for only about 1%, classifying it as a domestically driven industry. Thus, the impact from this U.S. measure is assessed as limited. The government will continue supporting related enterprises investing in the U.S. to obtain exemptions, reducing investment and operational costs and enhancing international competitiveness.

The Taiwan-U.S. Economic and Trade Working Group reiterated that, regarding U.S. Section 232 tariff developments, the government will maintain close bilateral communication based on the Taiwan-U.S. Investment Cooperation MOU, ensuring Taiwanese firms retain preferential treatments and safeguarding Taiwan’s industrial resilience and international competitiveness.