Thursday, April 10th 2025
GPUs Could be Exempt from Massive Trump Tariffs Through USMCA Assembly Loophole
High-performance GPUs manufactured in Taiwan could now enter the US market tariff-free through a technical loophole in the United States-Mexico-Canada Agreement (USMCA), found by a research firm SemiAnalysis. Companies can route Taiwan-made GPUs through assembly facilities in Mexico and Canada, effectively circumventing the 32% import duty that would otherwise apply to direct shipments from Taiwan. The exemption hinges on a Most-Favored-Nation clause within the USMCA framework that specifically classifies digital processing units (HTS 8471.50), automatic data processing machine units (HTS 8471.80), and their associated components (HTS 8473.30) as "originating goods." This classification applies regardless of manufacturing origin, creating a duty-free pathway for NVIDIA HGX boards, GB200 baseboards, and RTX GPU cards that undergo final assembly in North American facilities.
The strategy capitalizes on two complementary policy mechanisms. First, President Trump's March 7 executive orders maintained existing USMCA exemptions, preserving the duty-free status for compliant goods from Canada and Mexico. Second, the USMCA's expanded definition of originating products creates a classification framework that treats assembled servers and related components as North American products despite their core manufacturing in Taiwan. For US technology firms, the additional logistical complexity of cross-border assembly operations is offset by eliminating substantial import duties on these high-value components. This practice mirrors established protocols in agricultural imports, where products like Mexican avocados gain preferential treatment under similar origin rules. The global supply chain is adapting quickly, especially in high-margin areas like GPUs, which power AI workloads. We are yet to see how companies set up manufacturing and logistics in the new era of tariff-driven narrative.
Source:
SemiAnalysis
The strategy capitalizes on two complementary policy mechanisms. First, President Trump's March 7 executive orders maintained existing USMCA exemptions, preserving the duty-free status for compliant goods from Canada and Mexico. Second, the USMCA's expanded definition of originating products creates a classification framework that treats assembled servers and related components as North American products despite their core manufacturing in Taiwan. For US technology firms, the additional logistical complexity of cross-border assembly operations is offset by eliminating substantial import duties on these high-value components. This practice mirrors established protocols in agricultural imports, where products like Mexican avocados gain preferential treatment under similar origin rules. The global supply chain is adapting quickly, especially in high-margin areas like GPUs, which power AI workloads. We are yet to see how companies set up manufacturing and logistics in the new era of tariff-driven narrative.
45 Comments on GPUs Could be Exempt from Massive Trump Tariffs Through USMCA Assembly Loophole
Politics aside....
Hopefully, this loophole is exploitable and we can get GPU's exempt at least. I'm not looking to pay increased prices on my electronics and 'suffer a little bit for what's right' because I'm not gonna suffer a little bit. lol.
If voters applied even an iota of skepticism to the man in office now he wouldn't be there. Instead, we have people who have faith and belief, which is underpinned by hope, the foundation of which is optimism.
So I don't think it's entirely inaccurate to say we need realism, not optimism. Could all be sophistry in the end through.
Its the human condition. We're no different in the EU, voting for idiots like Wilders / PVV over here in NL or AfD in Germany. Some people are stuck in the past. Skepticism doesn't even come into play for them, they just want to go back to what they consider was better.
We've seen it every election. The voters that are mobilized now are those unhappy with what previous governments brought them. I recognize that feeling with myself. But is that realism? And is it correct skepticism? I beg to differ. The world will never be perfect and we all have trouble acccepting that. People also want to correct injustice. Those two elements are the main issues with elections. People feeling wronged by 'the other' and using the election to fight that battle. But in reality... like I tried to say above... we all want the same things. We all want to live a prosperous, happy life. For some that's sitting in church every sunday, others prefer to jack off on sunday - whatever. Live and let live.
The longer I live the less I'm a believer people should be standing up against each other. It doesn't work, nobody wins. And we've written history of success and progress by making peace and trading more. It just falls flat on its face when some people stop believing that's better than bashing each other's heads in.
To me, optimism is the belief people don't benefit from being bad, because we're no longer in a world where that truly gets rewarded. It gets punished. Either by law, conscience, stock markets... you name it. Its the only path forward that isn't escalation into worse pictures of the human condition that lead to worse conclusions. Its also something that gets stronger the more we believe in it - much like the way money works - and that's a proven concept.
The problem is that US politics since 2001 have been dominated by fear, and even earlier than 2001 too. Fear dominates this country beyond anything; you see it everywhere. Our Media, social media, our politics, our beliefs, ideas, everything. Unfortunately, in my opinion, having a president such as you know who was inevitable with the trajectory our country has been following for decades.
I hope that we eventually realize that its fear that's ruining this country and not X, Y, Z, or whatever new thing they come up with to blame.
Wasn't my choice to have some idiot come into office and make the US public stupidity #1.
Unlike Russia or China, you live in a democracy, you have to assume responsibility for what you did as a country. Maybe it isn't fair to you personally but i really couldn't care less. Your president is threatening to invade other countries on a daily basis, i barely see protests, that's deeply sad. It's a sick country. People protested more in Russia and they were facing going to Siberia and disappearing.
Do I think people in Europe should suffer through VAT & stuff? No. Or other problems? no. But I'm not gonna go out of my way to say that they 'deserved it' because a lot of them certainly didn't ask for me. Do Russians deserve to be hated against and called several things under the sun just because their country is doing terrible things? No. Many of them are also trying their best to resolve their own problems, as much as they can.
Do I hope Putin loses this war he has with Ukraine? Absolutely. I donate to my charities and hope as best as I can that it does. But I am merely one person. I can organize, I can get people moving through a movement, but ultimately, and unfortunately, our 'majority' spoke and would rather look the other way. It's not surprising. The most terrible nations are often fueled by the indifference of people to tragedies.
You can blame people all they want, as its often them who get these sorts of people into power, but lets not pretend everyone is deserving of such. Because not only is that not fair, its taking attention away from the bigger problem. And it's not a uniquely American problem as is. (It's a pattern in history that is seen many, many times. Any basic world history class can show you this.)
Is it a sick country? Yes. Yes it absolutely is. I think we've had some great moments but I would argue we've had many more terrible moments, It's been this way for what feels like forever (or at least, as long as I've been alive.) That doesn't mean there isn't people trying or people who aren't trying to fix things. There are protests happening (such as the tons at college campuses, or the one related to tesla, etc) but our media is so warped that its barely covered. And outside of the states a lot of this sorts of news is swept under the rug as it doesn't usually relate to geopolitics.
Just because you don't see protests doesn't mean it isn't happening. You know for the longest time I thought Russia wasn't having much protests either. I found out I was wrong about that. And I'm very glad I was wrong!
TL;DR I am anything but indifferent, therefore I don't consider myself part of the problem. I am certainly not absolving my country of what its doing.
I'll leave you to that, as I don't wanna argue over this in a thread, especially since we are going off topic into pure politics territory. :) Have a good day.
Sick as in, just like you showed, there is a real lack of grasp on almost anything and makes you do and say weird stuff. Don't blame just Trump, if you're going to say stuff like this.
This is case and point right here.
That seems to be indicating 2 things 1.) we CAN learn but also sadly 2.) we don't carry that learning across generational boundries. This can most likely be blamed on poor education.There is certainly an argument our electorate needs to learn things the hard way, sadly. It's why when Trump won I started greeting his supporters with "I hope you get everything you voted for..." Because the pain coming is neccesary for the american learning process, aparently.
www.dw.com/en/us-to-grant-tariff-exemptions-for-smartphones-computers/a-72228361
Tariff exemptions are being granted to tech, likely at the request of Apple and Nvidia
I did not mean to somehow relate that to the threats towards canada. Not sure where you derived that from.What?
If this is a comment about me being Ill-informed than sure, fine, but lets not generalize. Generalization's doesn't help anything. Again, people have said the same things in relation to all sorts of countries. Russia had a lot of sentiments like this to thrown at it, and as much as its compelling and easy to blame the WHOLE, often when you look into the bigger picture, its never that simple.
The point I was trying to draw is that even the most rational of people can make terrible choices when fear is a big motivator. Seen many of my more moderate friends vote for Trump under false pretenses and after the first month of him in office they began to regret it. I don't bash them for that but I will tell them that they should of thought more critically; but again, sometimes that's the coinflip you toss when you're voting for X or Y. America's political system is undoubtedly, sucky. And sometimes your choice is literally left to a coinflip because both candidates could be awful. And abstaining from voting is also not a solution. There's no winners in American politics. At least when it comes to the actual people who make up the states anyway. Not to paint us as some saints who get mistreated but there's no 'good' side to American politics IMO. Just bad and slightly less bad 99% of the time.
Already had a British pal get a laugh out of me about our politics being NEARLY as bad as English parliament (obviously he's trying to make a joke, its not that simple of a comparison), so at least I'm not super cynical about it at least..Not blaming just trump. But it should be very obvious where the head of the snake is.
I blame fear. That's the difference between my beliefs and some other peoples. I don't care for left.. right, whatever, because at there most moderate levels they both have points. It's the fear that dominates the radical sides of them that bring awfulness. And history often repeats with the continued idea of "fear leads to awful, terrible governments", which I'm sure I don't have to list out every single country which has had an awful government at one point in time because of said fear.
Corruption also plays a big part into that too. Something which isn't as common but certainly noticeable. US has a lot of that too (honestly, besides Russia and China, we are probably one of the worst examples right now.)My mistake; but again, lets not generalize a nuanced problem..
That's all, I promise. Hopefully that helped you understand my points a bit better (though it seems your pretty deadset in your beliefs, but I try to understand where your coming from)It's always seemingly one step forward, four steps back. Our politics are dominated by radicalness and agendas perpetuated by fear and distrust of each other and everything.. It's easy to get cynical when you look into it. Because we (the people) don't ever win really. Only for maybe one president term before next guy comes in and tears everything the last one did down, usually 80% of the time, even among people within the same parties.
It's hard for me to stomach living in this country sometimes knowing that every election year I'm looking at two people babble at each other and usually at least one of them is pretty radical, and the radical one is usually the one who wins.I wouldn't of minded a tariff affecting electronics if it wasn't potentially as high as it could of been.. something comparable to how VAT effects GPU prices in Europe would of hurt at first personally but been fine probably.. would of hurt the second hand market though (which is my prime hunting grounds!)
Governments should stay away from tariffs and censorship (if possible), but taxes can be fine DEPENDING on execution. we've seen good and bad examples, but that's a whole other discussion that isn't really relevant to the topic lol.
@Scattergrunt, I would ignore our guy bombly. He's obviously clueless as to how things are in the USA and sadly is fond of talking from the wrong end of his anatomy. Not worth the effort IMO.
I was not gonna continue it much further as is anyway with him, as I understand he might not fold / understand / whatever is appropriate, or correct. And that's okay. Best for both of us to just leave it then.
Setting aside the political situation, the idea behind tariffs is the stick to the protectionist carrot. Let's say Uzbekistan decided tomorrow that it wanted to corner the world's production of spoons...because this should be a laugh. This came down as a political directive, and the government wants to be the world's supplier of spoons. Inside Uzbekistan the government gives massive incentives to spoon manufacturers, like ultra low interest loans to anyone building a spoon factory, low tax rates, and even works with them to bypass regularly strict requirements in building spoon factories. As such, Uzbekistan slowly pushes into international markets with a spoon that is 80% as good as domestic options, for 70% of the price. This collapses local spoon production...and in 5-10 years the only spoons you can buy are from Uzbekistan. The Uzbek government has collapsed industry in their neighbors...and if we go silly they can now charge 140% of the price of the old local spoon manufacturers...or deny spoon shipments...based upon exactly what their government wants.
The example is silly, but it's the goal of tariffs. You try to corner a market using free market economics, the government protects local business from crashing by stabilizing the costs through additional taxation. This is how everyone is meant to stabilize things...because it's the mechanism meant to prevent market shifts and shocks due to unilateral changes.
Whether you believe in the process now or not, it's basically a race now to figure out how to minimize costs. Ideally high tariffs bring business back onshore to avoid the tariffs...that was offshored because benefits in other countries made it more financially viable there. I'm just about certain that there'll be a ton of stuff that is shipped to Mexico and Canada, then final assembled or sold as "used" to get around the tariffs...and it's up to the government to play that game of whack-a-mole. It's funny how this loop-hole was pointed out...and it's funnier how quickly it was highlighted for closure. Almost like everybody is hurting from this...but the most telling thing I can offer is economics. $36.22 Trillion. It's the difference between what the US takes in and spends...so maybe whatever the solution is, it can offer a little less of a crushing debt for our children to pay off...if today I have to pay an extra 10% for a video card...that Nvidia has managed to bork drivers so bad that their new line-up kills professional programs.
-Edit-
If it isn't clear, Taiwan's "spoon" is the government support of TSMC.
Germany's spoon has been the automotive market for decades.
Ukraine's spoon was the wheat harvest.
Spoons are not a bad thing...and specialization does allow for amazing increases in efficiency. It's just very difficult to be able to tell when to cull your spoon manufacturers, so they can compete, and when protecting them means throwing good money after bad due to inherent flaws...and this is why political matters like this suck. It's so much easier to cost-benefit your spoon, but it does lead to dependency that means you cannot detach from your neighbors due to them supporting core resources. IE, a headache.
-Edit end-
Now that's called being polite :cool: