SIA Advocates for U.S. Trade Policies that Advance American Leadership in Semiconductors

by Mary Thornton, Vice President, Global Policy

Semiconductors are in the spotlight. Over the past few years, governments and industry alike have recognized the critical role semiconductor technologies play in fueling America’s economic and industrial competitiveness, strengthening national security, and underpinning America’s leadership across a range of technologies. Today, David Isaacs, Vice President of Government Affairs at SIA, will offer testimony to members of the Senate Finance Committee on the importance of advancing trade, tax, deregulation, and other policies designed to ensure America’s leadership in semiconductor technology remains unchallenged.

Today’s hearing, titled “Trade in Critical Supply Chains,” is especially timely, as it comes on the heels of SIA’s recent submission to the Commerce Department to inform its ongoing Section 232 investigation (90 Fed. Reg. 15950) on the national security impact of imports of semiconductor technologies and their derivative products.

The U.S. semiconductor industry has held the pole position in the global market for the past several decades and currently commands 50.7% of the global market share. The U.S. government and industry should work together to pursue a comprehensive policy strategy designed to maintain and grow U.S. leadership. To that end, we support President Trump’s objective to reshore American semiconductor production, which is critical to strengthening U.S. supply chains. SIA member companies are investing over half a trillion dollars (and counting) in new manufacturing, research, and development facilities across 28 states and training the next generation of American talent and workforce.

But trade remains critically important to American semiconductor leadership. Roughly 70% of U.S. semiconductor industry revenue in 2024 came from sales to customers outside the U.S. To justify and support long-term, capital-intensive investments in U.S. semiconductor production, chipmakers need confidence that their products will have access to global markets and a global customer base, in addition to robust domestic demand. We must also ensure that the United States is a cost-competitive location to develop and produce chips. U.S. trade policy and other domestic policies (e.g. tax, permitting, etc.) should be designed to reduce the cost gap between constructing and operating semiconductor production facilities in the U.S. vs other locales.

We are eager to work with the Trump Administration and Congress, and offer the following recommendations to achieve these goals:

• Pursue a sectoral agreement on semiconductor technologies and derivative products with likeminded allies and partners to create preferential markets for U.S. chips and downstream electronics products and incentivize the creation of more resilient supply chains.
• Implement domestic tax incentives to spur additional investments in the domestic semiconductor ecosystem and bolster supply chain resilience, including by extending and expanding the Advanced Manufacturing Investment Credit (AMIC) (IRC Section 48D).
• Streamline regulations to accelerate investment in the U.S. chip supply chain, including by reviewing regulations that may inadvertently stifle the ability to build semiconductor manufacturing facilities.
• Fund research and development and workforce training programs. This includes funding robust federal R&D programs such as the NSTC, NAPMP, SMART USA Institute, CHIPS Metrology Program, and DOD Commons, and advancing recommendations in SIA’s policy blueprint for workforce development.
• Advance policies that lower the cost for critical inputs, including materials and equipment, necessary to design and manufacture semiconductors in the United States.

SIA and our member companies stand ready to work with the Administration and Congress to advance economic policies that reinforce America’s industrial strength and supply chains, protect our national security, innovation base, and semiconductor technology leadership, and achieve our shared goals of making America safer, stronger, and more prosperous.