Donald Trump has claimed that he asked Emmanuel Macron to remove the 3 per cent tax on US tech giants or stay ready to face duties in the American market.
Image: IANS
Donald Trump on Monday, June 15, warned that France could be at risk of a trade war with the United States. The US President said America will be left with “no choice” but to put 100% tariffs on French wine unless Paris decides to eliminate its digital tax on American tech giants.
In an interview with the New York Post, Trump claimed that he has delivered the warning directly to French President Emmanuel Macron. He has demanded Macron to remove the 3 per cent tax on US tech giants or stay ready to face duties in the American market.
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“I asked him not to charge American companies, and if they do, I have no choice but to charge a 100 per cent tariff on all champagnes and all wines coming out of France,” Trump said. “All (Macron) has to do is get rid of the sales tax, and he wouldn’t have that kind of pressure.”
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Notably the American market accounts for a fifth of the French wine industry’s global sales and is said to be worth over $2 billion annually.
As per reports, Trump’s demand sets the stage for a bitter showdown at Monday’s G7 Summit in Évian-les-Bains.
Last week, Macron’s office, the Élysée Palace, stated that the two sides have settled their long-running spat over taxing Silicon Valley.
What’s at stake?
Popularly known as the GAFAM tax, France’s digital services tax has remained on the books since 2019. Under this, the European nation imposes a 3 per cent levy on the local revenue generated by the likes of Google parent Alphabet, Amazon, Meta, and Apple.
Since it targets gross revenue rather than profits, the policy reportedly hits US tech titans the hardest. As per the French finance ministry, it raked in $700 million last year.
Alcohol is considered among the top exports to the United States from the European Union and was worth nearly $10.46 billion in 2024, as per Eurostat data.
In October last year, France’s National Assembly had voted 296-58 to double the tax to 6 per cent and narrow the threshold to target the global players. However, the move was later vetoed by ministers.
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