Trump threatens 100% tariffs over EU digital tax

President Donald Trump has threatened to impose 100% tariffs on all goods from countries that enact digital services taxes targeting American companies. This move escalates trade tensions between the U.S. and Europe, coming just a day after the EU met a deadline to reduce tariffs on U.S. goods.

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U.S. President Donald Trump threatened on Friday a 100% tariff on all goods from any country that imposes a digital services tax on American companies, inflaming transatlantic trade tensions a day after ​European Union countries met Trump’s July 4 deadline to cut tariffs on U.S. goods.

Trump stated that these new tariffs would override any existing trade agreements, including a deal with the EU from last year. This agreement had capped U.S. tariffs on European goods at 15% in exchange for the EU eliminating tariffs on U.S. industrial products. However, delays in the EU's legislative process to implement these changes led Trump to threaten a 25% tariff on European imports, including automobiles.

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Trump said the new tariff would supersede any trade deals with the United States, “whether implemented, signed or not.”

The EU lawmakers then rushed to meet Trump's July 4 deadline for these changes. French President Emmanuel Macron had previously stated that France would not withdraw its digital tax on U.S. tech giants, despite pressure from Trump. France's digital services tax, applied since 2019, targets revenue from online marketplaces and advertising for companies earning over €25 million in France and €750 million globally.

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French President Emmanuel Macron said last week, before meeting with Trump at a G7 summit, that France would not bow to pressure from him and scrap ​its digital tax on U.S. ​tech giants.

The U.S. Trade Representative's office has a history of threatening retaliatory tariffs against European nations like France, Britain, Austria, and Spain. The U.S. argues these digital taxes discriminate against American companies, which hold a dominant position in the global tech sector.

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Before setting off for the summit in France, Trump had warned that the U.S. would “have no choice” but to apply ​100% tariffs on French wine unless Paris eliminated its digital tax.