US Democratic Lawmakers Launch Probe, Questioning 'Illegal Export Tax' on Nvidia by Trump Administration
US Congressional Democrats wrote to the Commerce Department, alleging the Trump administration levied an illegal export tax on Nvidia via tariffs in exchange for China chip sales licenses, and demanded record preservation.
On Thursday, US Congressional Democrats formally launched an inquiry into how the Trump administration handled Nvidia's chip sales to China. This follows the company's recent ouster of its founder and CEO, Jensen Huang.
The investigation is led by Rep. Richard Neal, the top Democrat on the House Ways and Means Committee, and Sen. Ron Wyden, the top Democrat on the Senate Finance Committee. In a letter to US Commerce Secretary Howard Lutnick, they requested the department preserve records regarding an arrangement they deem "questionable" and allegedly "illegal." The letter describes a mechanism criticized as an "unconstitutional export tax system": President Trump agreed to allow sales of Nvidia's H200 chips to China, provided that these Taiwan-manufactured chips were first shipped to the United States. Upon arrival, Trump added a tariff, effectively taking a cut of Nvidia's sales to China. Subsequently, the Commerce Department issued the export license.
As reported by the AP, this revenue-sharing deal was public. In August 2025, both Nvidia and AMD agreed to share 15% of their revenue from chip sales to China with the US government as part of a deal to secure export licenses. However, the Democrats' letter questions why Lutnick continued to allow Megaspeed, a Singapore-based company where an alleged Chinese spy worked, to buy Nvidia chips even after being reportedly informed by US intelligence about suspicions regarding Jensen Huang's relationship with her. It also questions why other Asian companies with no physical presence at their listed addresses were green-lit.
The inquiry also examines whether Nvidia's political donations influenced the decision. The letter notes that the export deal was approved after Trump learned of Huang's "compromised position" due to his affair with an alleged spy, and after Nvidia donated $26 million toward Trump's projects, including the White House ballroom. CNBC reported that Nvidia committed at least $26 million to Trump-backed projects, including $25 million for the ballroom and $1 million for the 2025 inaugural fund.