Trump vows immediate 100% tariff if countries levy digital services tax

President Trump is threatening to impose a 100% tariff on countries that levy a tax on U.S. companies offering digital services. 

In a social media post on Friday, Mr. Trump pointed to European countries considering implementing a so-called “digital services tax,” which are aimed at companies that do business in a country but lack a physical presence there and do not pay income tax.

“European Countries have been discussing the imminent implementation of a Digital Services Tax on American Companies,” he said on Truth Social. “Some of these Countries are close to actually doing this. Please let this statement serve to represent that any Country that imposes such a Tax will immediately be met with a 100% TARIFF on any and all Goods sent to the United States of America.”

A new U.S. tariff on other nations’ imports would override any trade agreements with a trading partner, Mr. Trump noted, adding that the 100% import duty would be imposed immediately if a country proceeds with a digital services tax.

Roughly half of all European members of the Organisation for Economic Co-operation and Development have proposed, announced or already implemented a digital service tax, according to the nonpartisan Tax Foundation, which notes that such taxes would mostly affect U.S. companies. 

Mr. Trump has set a July 4 deadline for the European Union and the U.S. to finalize a trade deal that caps tariffs on most EU exports at 15%. Digital taxes were not part of the agreement and have remained a sticking point between the U.S. and the European bloc.