By Nandita Bose, David Lawder and Steve Holland
WASHINGTON (Reuters) – President Donald Trump said on Friday that he would sign a memorandum to impose tariffs on countries that levy digital service taxes on U.S. technology companies.
A White House official, providing details of the order, said Trump was directing his administration to consider responsive actions like tariffs «to combat the digital service taxes (DSTs), fines, practices, and policies that foreign governments levy on American companies.»
«President Trump will not allow foreign governments to appropriate America’s tax base for their own benefit,» the official said.
The memo directs the U.S. Trade Representative’s office to renew digital service taxes investigations that were initiated during Trump’s first term, and investigate any additional countries that use a digital tax «to discriminate against U.S. companies,» the official said.
Trump, asked at the White House if he would sign a tariff order on digital taxes, told reporters: «We are going to be doing that, digital. What they’re doing to us in other countries is terrible with digital, so we’re going to be announcing that, maybe today.»
Trump said last week that he would impose tariffs on Canada and France over their digital services taxes, and a White House fact sheet released at the time said that «only America should be allowed to tax American firms.»
It complained that Canada and France used the taxes to each collect over $500 million per year from U.S. companies.
«Overall, these non-reciprocal taxes cost America’s firms over $2 billion per year. Reciprocal tariffs will bring back fairness and prosperity to the distorted international trade system and stop Americans from being taken advantage of,» said the fact sheet. It gave no further details.
LONGSTANDING IRRITANT
The digital service taxes aimed at U.S. tech giants including Alphabet’s Google, Meta’s Facebook, Apple and Amazon have been a source of trade disputes for years.
Britain, France, Italy, Spain, Turkey, India, Austria and Canada have imposed the taxes, levied on revenues earned from digital services sold within their borders.
The U.S. Trade Representative’s office during Trump’s first term found them to discriminate against U.S. companies in its investigations and readied retaliatory tariffs.
President Joe Biden’s trade chief, Katherine Tai, in 2021 followed up on these probes and announced 25% tariffs on over $2 billion worth of imports from six countries, but immediately suspended them to allow negotiations on a global tax deal to continue.
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