The European Union is drawing a line in the sand over its right to tax Big Tech, even as President Trump threatens to blow up the latest trade truce with a 100% tariff on imports from countries that dare to levy digital services taxes on American companies.
The European Commission responded on June 26 by affirming the EU’s sovereign right to regulate economic activity within its borders, insisting that its digital services taxes are non-discriminatory and apply equally to all companies regardless of where they’re headquartered.
The tariff threat and what triggered it
The US and EU had just reached a trade deal that capped tariffs on most EU exports to the US at 15%. Digital services taxes were notably excluded from the deal.
Trump’s 100% tariff threat targets any country that imposes a DST on US companies. He has previously described these taxes as “extortion” aimed at American tech firms.
