Though the United States is the global leader in designing chips, the vast majority of chip production happens overseas, particularly in U.S.-ally Taiwan.

The tariffs would ensnare cutting-edge smartphone and PC-related chips for Apple, AMD and Nvidia if enacted. But Trump is betting his plan will bring more chip production to the US.

Taiwan's government has been swift to respond to the talk of huge tariffs by the recently inaugurated 47th president of the United States.