Why did Trump exempt chips imported for U.S. data centers from the 25% tariff while taxing other chip imports?

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The exemption rewards hyperscalers like Microsoft, Amazon, Google, and Meta that are building massive U.S. data centers for AI training and cloud services. By allowing tariff-free chip imports for domestic data centers, Trump incentivizes companies to locate AI infrastructure inside U.S. borders rather than building data centers abroad. This splits the semiconductor market: chips flowing into U.S. tech infrastructure avoid tariffs, while chips used in foreign data centers or exported as finished products face the 25% levy. The strategy aligns with "America First" goals—make the U.S. the global AI hub by subsidizing inputs (CHIPS Act fabs + tariff-free data center chips) while taxing outputs (finished electronics leaving the country).

Why did Trump exempt chips imported for U.S. data centers from the 25% tariff while taxing other chip imports?

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