Trump Tariffs Could Cancel 20% of US Data Center Projects
The Trump administration is weighing sweeping semiconductor tariffs that industry groups estimate could cost the US $90 billion annually in GDP and delay or cancel roughly 20% of data center projects planned through 2030.
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The Trump administration is weighing sweeping semiconductor tariffs that industry groups estimate could cost the US $90 billion annually in GDP and delay or cancel roughly 20% of data center projects planned through 2030, according to a Politico report cited by Ars Technica. The tariffs could be announced within weeks or months, sources told Politico.
- CCIA estimates the tariffs could cost ~$90 billion annually in GDP and cancel or delay about 20% of US data center projects through 2030
- The proposed framework could hit not just chips but downstream products - servers, gaming consoles, smartphones, laptops and even used or refurbished devices containing chips
- Tariff relief is under discussion but would likely be tied to foreign firms, such as TSMC, investing in US chip manufacturing
About eight people familiar with the administration’s plans described one scenario under consideration that would dramatically expand the products subject to duties - covering not just chips but servers, gaming consoles, and potentially used or refurbished products containing semiconductors. The Computer and Communications Industry Association (CCIA) called that the industry’s nightmare scenario in a May letter to Treasury Secretary Scott Bessent, cosigned by roughly 20 trade groups.
The CCIA warned in June that such a broad tariff structure would also risk pushing more data center development outside the US - an outcome that appears to contradict the stated goal of the Trump AI Action Plan, which aims to concentrate AI infrastructure domestically.
“Consumer devices are the primary interface through which Americans access AI-powered tools. AI only delivers on its promise when people can actually use it - and tariffs that price consumers out of the device market would slow AI adoption at the very moment the United States is positioned to lead.”
Some tariff relief is reportedly under discussion. Commerce Secretary Howard Lutnick is said to favor an approach that ties exemptions to foreign companies - such as Taiwan Semiconductor Manufacturing Co. - committing to invest in US chip fabrication. A phased rollout is also being considered to soften the immediate impact, possibly with timing influenced by the holiday shopping season.
Practical takeaway: For developers and small-business owners building on AI, the near-term risk is higher hardware costs and delayed server capacity - both of which feed into cloud pricing and availability. If data center projects are deferred at scale, demand for GPU compute could outpace supply more sharply than it already does, pushing API costs up. Monitoring tariff exemption announcements for cloud hardware and chips is worth adding to any infrastructure planning checklist right now.
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