US President Donald Trump has called for the repeal of the $52.7 billion semiconductor chips subsidy law, known as the CHIPS Act, which was signed into law in 2022. In a recent speech to Congress, Trump criticised the act, stating, “The CHIPS Act is a horrible, horrible thing. We give hundreds of billions of dollars and it doesn’t mean a thing. They take our money and they don’t spend it.”
The CHIPS Act was designed to boost US semiconductor manufacturing and reduce reliance on foreign suppliers. It included $39 billion in subsidies for US semiconductor manufacturing and related components, along with $75 billion in government lending authority2. The act has been praised for attracting significant investments from major companies like Taiwan Semiconductor Manufacturing Co. (TSMC), Intel, Samsung Electronics, and Micron Technology.
Despite the positive impact on the US semiconductor industry, Trump argued that the funds could be better used to reduce national debt. He urged Congress to “get rid of the CHIPS Act and whatever is left over, Mr. Speaker, you should use it to reduce debt”.
Commerce Secretary Howard Lutnick has praised the program but expressed concerns about the potential invalidation of binding grant agreements made during the Biden administration. New York Governor Kathy Hochul highlighted the act’s importance, stating that it has brought significant investments and jobs to Central New York.
