France to target big tech for EU’s retaliation to US tariffs
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The news: France is angling for the European Union to hit US tech firms as part of the bloc’s response to President Donald Trump’s tariffs.
The numbers: On Wednesday, Trump unveiled plans to impose 20% tariffs on the EU’s exports to the US, on top of auto and steel and aluminium tariffs announced last month.
The context: Speaking to RTL radio on Thursday, French government spokeswoman Sophie Primas said that the government plans to “attack services” including US digital services which are not yet taxed. French President Emmanuel Macron has previously said that while the US has a deficit with the EU for goods, it runs a large surplus in services.
Taxation in the EU is determined at a state level, which could make achieving a unanimous agreement across the 27 members challenging.
Primas added that the EU could target services by the end of April, flagging the bloc’s ‘anti-coercion instrument’ which would allow it to respond against nations that use trade or economic measures coercively.
In 2019, France implemented a digital services tax on big tech companies including Meta and Alphabet which Trump has said unfairly discriminated against American firms. France’s annual take from the tax in 2023 reached €700 million ($1.22 billion).
The Financial Times reported Thursday that the Union has given itself four weeks to negotiate with Trump in the hopes that the US backs down from the tariffs, before countering with retaliatory tariffs. European Commission President Ursula von der Leyen said the bloc was “prepared to respond” to the US levies but emphasised it preferred to negotiate to “remove any remaining barriers to transatlantic trade.”
EU member states will vote on countermeasures to the US’ steel and aluminium tariffs on Wednesday 9 April, Reuters reports. The proposal, which will impose duties on up to €26 billion of US goods, will be passed as long as it is not opposed by a qualified majority of 15 member states representing 65% of EU population.
The sources: Bloomberg, Financial Times, Reuters
