President Trump is threatening to blow up transatlantic trade over a tax that most Americans have never heard of. On June 15, he warned French President Emmanuel Macron that the US would impose a 100% tariff on French wine and champagne unless France repeals its digital services tax, a 3% levy targeting major US tech companies.
Macron’s response: no. France will not abandon the tax.
What the digital services tax actually is
France enacted its DST back in 2019, making it one of the first countries to directly tax the digital revenues of large tech firms.
The tax applies a 3% levy on digital revenues from companies that exceed €750 million in global revenue and €25 million in French revenue. In English: it’s designed to hit the Googles, Amazons, and Metas of the world, companies that generate enormous revenue in France but historically paid relatively little in local taxes thanks to creative corporate structuring.
