Trump Escalates Dispute over French Digital Tax

US President Donald Trump has threatened France with a 100 percent tariff on wine and champagne if Paris does not repeal its digital services tax on technology companies, according to The New York Post, citing Euractiv.

France introduced a 3% tax on the revenues of large technology companies operating in the country in 2019. The measure applies to major US firms, including Amazon, Apple, Facebook and Google's parent company, Alphabet.

According to the report, Trump said he had urged French President Emmanuel Macron to abolish the tax. If France refuses, the United States will impose steep tariffs on French wine and champagne imports.

The United States is the largest importer of French wines and spirits. According to the French Federation of Wine and Spirits Exporters, 21% of the sector's exports were destined for the US market last year. French and other European wines are already subject to a 15% tariff. Exports of French wines and spirits to the United States declined by 21% year over year last year.

Trump threatened France with similar measures during his first term after the introduction of the digital services tax. He also engaged in a similar dispute with Canada, which agreed last year to repeal its digital services tax as part of trade negotiations with the United States.

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