The Trump administration is launching investigations into the importation of pharmaceuticals and semiconductors, aiming to impose tariffs on these sectors citing national security concerns, as indicated by notices released in the Federal Register on Monday.
The documents set to be published on Wednesday establish a 21-day timeframe for the public to submit comments on the matter, suggesting that the administration plans to implement these levies under the authority of the Trade Expansion Act of 1962. These inquiries must be finalized within 270 days from their announcement.
During Donald Trump’s previous presidency, a total of 232 investigations were initiated into the imports of copper and lumber. These earlier inquiries formed the foundation for tariffs imposed since his return to the presidency in January, impacting steel, aluminum, and the automotive industry.
The US began implementing a 10% tariff on imports starting April 5. While pharmaceuticals and semiconductors were previously exempt from these duties, Trump has indicated that separate tariffs will be applied to them.
On Sunday, Trump mentioned that he would reveal a tariff rate for imported semiconductors within the following week, also noting that some companies within the sector may receive flexibility.
The US relies significantly on chips imported from Taiwan, an issue that President Joe Biden aimed to address by allocating billions in Chips Act funding to encourage chipmakers to increase production within the United States.
The investigation announced on Monday will encompass pharmaceuticals, pharmaceutical ingredients, and other related products, as highlighted in the notice.
Pharmaceutical companies have contended that implementing tariffs could heighten the risk of shortages and limit patient access to medications. Nevertheless, Trump advocates for these fees, asserting that the US must bolster its domestic drug manufacturing to lessen reliance on foreign suppliers.
Industry stakeholders have lobbied Trump to gradually implement tariffs on imported pharmaceutical products, hoping to ease the financial impact of these charges and provide time for a transition in manufacturing.
Major pharmaceutical companies have a global manufacturing presence, predominantly in the US, Europe, and Asia, and shifting more production to the US requires a significant investment of resources and can span several years.
