The CHIPS and Science Act (2022) is US legislation providing 52.7 billion USD in funding to boost domestic semiconductor manufacturing, research, and workforce development in response to supply chain and national security concerns.

Funding Breakdown:

• 39 billion USD: Manufacturing incentives (grants for fab construction and expansion)
• 11 billion USD: R&D programs (NIST-led research, National Semiconductor Technology Center/NSTC, advanced packaging institute)
• 2 billion USD: Defense and intelligence community chips
• 500 million USD: International coordination and supply chain security

Investment Tax Credit:

• 25% advanced manufacturing investment tax credit for semiconductor equipment and facility costs.

Key Award Recipients:

• Intel: 8.5 billion USD for Ohio, Arizona, Oregon, New Mexico fabs
• TSMC: 6.6 billion USD for Arizona fab complex
• Samsung: 6.4 billion USD for Taylor, TX fab
• Micron: 6.1 billion USD for New York and Idaho memory fabs
• GlobalFoundries: 1.5 billion USD for New York fab expansion

Guardrails:

• Cannot use funds to expand capacity in China or other countries of concern for 10 years
• Excess profits clawback provisions
• Workforce and childcare requirements
• Environmental review

NSTC:

• National Semiconductor Technology Center for pre-competitive research, prototyping, and workforce training.

Economic Rationale:

• US share of global chip production fell from 37% (1990) to 12% (2022)—CHIPS Act aims to reverse decline.

Complementary Legislation Globally:

• EU Chips Act: €43B
• Japan: Subsidies
• Korea: K-Chips Act
• India: Semiconductor incentives

Impact Assessment:

• Expected to catalyze 300-400 billion USD total private-public investment in US semiconductor manufacturing over the decade.
• Represents the largest US industrial policy investment in a single sector in decades.