Trump threatens 100% tariff on countries taxing US tech firms

President Donald Trump threatened to impose a 100% tariff on all goods from any country that adopts a digital services tax on American companies.

The escalation sharpened a dispute that has simmered for years between Washington and European capitals over taxes on digital advertising, online marketplaces and other tech-driven services. Trump had already warned before the G7 summit in France that he could retaliate against French exports if Paris refused to back away from its 3% digital tax. France enacted that levy in July 2019, setting it at 3% of gross revenue from taxable digital services earned in France by companies with more than €750 million in global digital revenue and more than €25 million in French revenue.

The Office of the United States Trade Representative opened a formal Section 301 investigation into France’s digital services tax on July 16, 2019, and called the French measure an unreasonable or discriminatory burden on U.S. commerce. USTR extended similar investigations to Austria, Italy, Spain, the United Kingdom, Turkey, Brazil, the Czech Republic, the European Union and Indonesia, then terminated or modified some of those actions in 2021. France’s Constitutional Court upheld the tax in September 2025.

Tariffs would fall on imported goods from the country involved, not only on the companies paying the tax. It could hit everything from French wine and farm goods to industrial equipment and consumer products if Washington follows through.

The dispute also sits inside a longer effort by the Organisation for Economic Co-operation and Development to build a two-pillar framework for international corporate taxation. European officials have defended the European Union’s right to regulate economic activity on its territory, even as the European Commission weighs new revenue ideas for the bloc. Trump’s warning came a day after the European Union approved tariff reductions on U.S. goods.