U.S. President Donald Trump has once again threatened to impose tariffs if European nations adopt a digital tax. Trump announced on his personal platform on Friday that any country collecting such a tax would immediately face a 100 percent tariff on all goods delivered to the United States. He further stipulated that this tariff would override all existing trade agreements with the affected country, regardless of their status-whether currently in force, signed, or not-and would be instantly applied upon the tax’s implementation.
Several EU member states, including Austria, France, Italy, and Spain, currently collect varying forms of digital taxes. These taxes were originally conceived as a transitional solution pending a coordinated redistribution of tax rights by the OECD, an initiative the U.S. is actively resisting. Separately, German Labor Minister Bärbel Bas (SPD) has recently shown support for a digital tax specifically targeting AI profits.
Politically, the threat is highly contentious. Although EU members had recently approved the US tariff agreement, the EU plans to suspend these concessions should the United States implement further tax increases. Trump had previously warned about imposing tariffs against EU tech regulation as early as 2025.
Both German Chancellor Friedrich Merz (CDU) and French President Emmanuel Macron sharply criticized the threat. Merz asserted that “the question of how the European Union regulates the entire digital market and how it taxes companies is an expression of the EU’s sole sovereignty.” He added that Europe would not accept any retaliatory measures from whomever attempted them, stating, “We can always discuss the subject, but the legislative sovereignty in Europe and in the member states, nobody is allowed to question that.” Macron echoed this stance, declaring, “We will not let anyone else decide these matters. I can assure you: if such measures are taken on the other side of the Atlantic, we must hit back.”
In a move toward dialogue, the EU recently indicated a willingness to engage the U.S. on digital issues. According to the “Handelsblatt”, EU Commissioner Vice President Henna Virkkunen is set to take responsibility for bringing Washington into a discussion about EU digital procedures concerning U.S. corporations.
