The U.S. Senate has just approved Donald Trump’s new bill, which could rewrite the rules of the game for the semiconductor industry. As global competition over chip sovereignty intensifies, Trump has a clear goal: bring the production of advanced chips back from Asia to American soil, using powerful tax incentives as the bait.

📉 From 25% to 35%: A Huge Boost for Chip Giants

The bill, passed in the Senate on Tuesday by a narrow 51–50 vote, raises the tax credit for companies like Intel, Micron, and TSMC from 25% to a generous 35%. This change is designed to encourage firms to invest billions of dollars into new U.S.-based factories, boosting domestic jobs and supply chain security.

According to CNBC, the goal is to move a large portion of the world’s advanced chip manufacturing to the U.S. by 2026.

🏭 Building on the CHIPS Act, But Going Further

Trump’s plan builds on the earlier CHIPS and Science Act of 2022, which offered $39 billion in grants and $75 billion in loans. But this time, it’s not about one-time handouts. This bill focuses on long-term tax benefits that aim to be even more attractive to manufacturers.

While the original proposal offered a 30% credit, the final version raised it to a full 35% – a level few companies would ignore.

⚠️ The House Could Still Block the Plan

Even though the bill passed the Senate, its future is far from secure in the House of Representatives, where it faces resistance from several Republicans. If more than three GOP members vote no, the bill is dead.

Andy Ogles of Tennessee has already slammed the Senate version as "flawed" and proposed replacing it with the House version. Ralph Norman, Thomas Massie, and Warren Davidson are also opposing it. Freedom Caucus chair Andy Harris hasn’t clearly stated his position yet, making the vote count very tight.

Trump wants the bill passed by July 4th, but the numbers may not be on his side.

Trump vs. Biden: Fewer Grants, More Tariffs

Trump’s approach sharply contrasts with Joe Biden’s CHIP strategy, which leans heavily on grants and federal aid. Instead, Trump favors tariffs over subsidies.

His administration has launched an investigation into semiconductor imports, which could result in new tariffs on foreign chip technologies. This would pressure companies to accelerate U.S.-based projects to avoid unpredictable trade costs.

🏗️ Companies Already Ramping Up U.S. Production

Tech giants like TSMC, Nvidia, Micron, and GlobalFoundries have already been intensifying their U.S. operations in recent months. They’re racing to secure the tax credits before the 2026 deadline – but that only applies if the bill becomes law.

🗳️ What’s Next?

The Senate passed the bill after Vice President J.D. Vance broke the 50–50 tie. But now the real challenge lies with House Speaker Mike Johnson, who must hold the GOP together – as no Democrats are expected to support the bill.

Trump is pushing for quick approval, but even a few Republican defectors could kill the proposal.




#TRUMP , #USPolitics , #economy , #USGovernment , #cryptocurrency

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