Welcome back to Taiwan Tariff News and Tracker. Here’s the latest as of September 28, 2025.

Tariff tensions between the United States and Taiwan are dominating headlines this week, with the Trump administration preparing sweeping new measures aimed squarely at foreign electronics and pharmaceuticals. According to Reuters and The Wall Street Journal, the Commerce Department is considering tariffs on imported electronics based on how many semiconductor chips are inside. The proposed rates are 25 percent for chip-related content and 15 percent for electronics from Japan and the European Union, though a final decision is still pending. White House spokesperson Kush Desai said these tariffs are part of a broader push to reshore critical manufacturing, citing national and economic security. The biggest target is Taiwan Semiconductor Manufacturing Company, or TSMC, the global leader in advanced chips.

Trump has also announced that beginning October 1, a 100 percent tariff will apply to all brand-name or patented pharmaceuticals unless the producer is building a manufacturing facility in the US. Taiwan’s health minister Shih Chung-liang reassured that most of Taiwan’s pharma exports are generics or active ingredients, so the impact on Taiwan’s exports should be limited. However, Taiwan imports around 214 patented drugs, with 75 classified as essential and irreplaceable, so price increases are expected on the island for some medicines. The Taiwanese government has set aside funding to stabilize prices and protect access to crucial medications, according to Taiwan News.

The semiconductor tariffs could have far-reaching effects, especially since approximately 90 percent of the world’s leading-edge semiconductors are still produced in Taiwan. Earlier this year, the threat of massive chip tariffs reportedly pushed TSMC to commit $165 billion in new US manufacturing investment. However, as The Register reports, TSMC’s Arizona operations will take years to ramp up, and the goal of American chip self-sufficiency remains elusive for now.

Against this complex economic backdrop, geopolitical maneuvering is escalating. The Wall Street Journal and Moneycontrol are reporting that Chinese President Xi Jinping is using the prospect of a comprehensive trade deal to press President Trump for a formal US rejection of Taiwanese independence. Xi’s push shifts the longstanding US position from not supporting, to outright opposing, independence—a move that would dramatically undercut Taiwan’s international standing and confidence in American support. In response, the Trump administration has kept its language ambiguous, delaying military aid to Taipei and denying key diplomatic transits.

As tariffs loom and diplomatic bargaining intensifies, the fate of Taiwan’s economic and political future remains entangled in the transactional dealmaking between Washington and Beijing. All eyes are now on whether these tariffs will become reality and how both businesses and ordinary citizens across Taiwan and the US will feel the impact.

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