President Donald Trump warned Monday that countries imposing digital taxes on American tech companies will face significant tariffs if they don’t remove them.
Without naming a specific country, Trump said that some nations had given a “complete pass” to China’s tech companies while penalizing American competitors. Some countries, like Canada and India, have already backed away from digital taxes after pressure from the Trump administration.
“As the President of the United States, I will stand up to Countries that attack our incredible American Tech Companies. Digital Taxes, Digital Services Legislation, and Digital Markets Regulations are all designed to harm, or discriminate against, American Technology,” Trump wrote on Truth Social.
“This must end, and end NOW! With this TRUTH, I put all Countries with Digital Taxes, Legislation, Rules, or Regulations, on notice that unless these discriminatory actions are removed, I, as President of the United States, will impose substantial additional Tariffs on that Country’s Exports to the U.S.A., and institute Export restrictions on our Highly Protected Technology and Chips,” he added. “America, and American Technology Companies, are neither the ‘piggy bank’ nor the ‘doormat’ of the World any longer. Show respect to America and our amazing Tech Companies or, consider the consequences!”
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In June, Canada rescinded its Digital Service Tax as part of ongoing trade negotiations with the United States. The tax would have hit American tech companies like Amazon, Google, Meta, and Apple hard, and could have cost American businesses up to $2.3 billion annually.
India also backed away from a 6% digital advertising tax in April after pressure from American officials.
Many European countries, like France and Switzerland, have implemented digital taxes, while others, like Belgium and the Netherlands, are considering implementing them. France taxes major tech companies 3% on revenue from digital services and targeted advertising.
In the trade deal between the European Union and the United States, both entities agreed to address “unjustified digital trade barriers.”
“In that respect, The European Union confirms that it will not adopt or maintain network usage fees,” the framework said. “The United States and the European Union will not impose customs duties on electronic transmissions.”
It is unclear if the agreement will address digital service taxes.
