The Trump administration on Monday threatened to impose tariffs on up to $2.4 billion worth of French goods in a dispute over that country’s new digital services tax. It also said it could impose fees or restrictions on some French services.
The Office of the U.S. Trade Representative said an investigation found that France's tax unfairly discriminates against big U.S. tech companies like Facebook, Google, Apple and Amazon, which dominate the digital services market.
“USTR’s decision today sends a clear signal that the United States will take action against digital tax regimes that discriminate or otherwise impose undue burdens on U.S. companies,” U.S. Trade Representative Robert Lighthizer said in a statement.
USTR is soliciting comments from the public on its proposed action, which includes slapping added duties of up to 100 percent on $2.4 billion worth of French products.
The Trump administration has already targeted French wine and many agricultural products in another dispute over European support for Airbus. This time it is threatening to focus its firepower on famous French cheeses and champagne.
French President Emmanuel Macron signed the digital tax measure into law in July, but it is retroactive to Jan. 1. Companies were required to make an initial payment in November, and in the future the tax will be collected in April and October, according to the international accounting firm KPMG.
Various estimates put the amount of tax France is expected to collect between $500 million and $1 billion annually. The 3 percent levy applies to companies with more than 25 million euros in digital services revenue in France and 750 million euros ($825 million) worldwide.
France — and a growing list of other countries — want to tax companies that sell or advertise goods online to their citizens, even if they are based in the United States.
The U.S. announced the move after a 90-day truce that was agreed to at the G-7 leaders summit in August. Officials from France and the U.S. tried to address the issue through an agreement being negotiated among member countries of the Organization for Economic Cooperation and Development, but the latest action indicates that the two sides seem to have hit an impasse.
The USTR's notice also seeks comment on the option of imposing fees or restrictions on French services. The final value of any U.S. action through either duties or fees "may take into account the level of harm to the U.S. economy resulting from the digital service tax," USTR added.
The agency will hold a public hearing Jan. 7 on its proposed retaliation and take public comment through Jan. 14.
The Office of the U.S. Trade Representative said an investigation found that France's tax unfairly discriminates against big U.S. tech companies like Facebook, Google, Apple and Amazon, which dominate the digital services market.
“USTR’s decision today sends a clear signal that the United States will take action against digital tax regimes that discriminate or otherwise impose undue burdens on U.S. companies,” U.S. Trade Representative Robert Lighthizer said in a statement.
Story Continued Below
“Indeed, USTR is exploring whether to open Section 301 investigations into the digital services taxes of Austria, Italy, and Turkey. The USTR is focused on countering the growing protectionism of EU member states, which unfairly targets U.S. companies, whether through digital services taxes or other efforts that target leading U.S. digital services companies," Lighthizer added.USTR is soliciting comments from the public on its proposed action, which includes slapping added duties of up to 100 percent on $2.4 billion worth of French products.
The Trump administration has already targeted French wine and many agricultural products in another dispute over European support for Airbus. This time it is threatening to focus its firepower on famous French cheeses and champagne.
French President Emmanuel Macron signed the digital tax measure into law in July, but it is retroactive to Jan. 1. Companies were required to make an initial payment in November, and in the future the tax will be collected in April and October, according to the international accounting firm KPMG.
Various estimates put the amount of tax France is expected to collect between $500 million and $1 billion annually. The 3 percent levy applies to companies with more than 25 million euros in digital services revenue in France and 750 million euros ($825 million) worldwide.
France — and a growing list of other countries — want to tax companies that sell or advertise goods online to their citizens, even if they are based in the United States.
The U.S. announced the move after a 90-day truce that was agreed to at the G-7 leaders summit in August. Officials from France and the U.S. tried to address the issue through an agreement being negotiated among member countries of the Organization for Economic Cooperation and Development, but the latest action indicates that the two sides seem to have hit an impasse.
The USTR's notice also seeks comment on the option of imposing fees or restrictions on French services. The final value of any U.S. action through either duties or fees "may take into account the level of harm to the U.S. economy resulting from the digital service tax," USTR added.
The agency will hold a public hearing Jan. 7 on its proposed retaliation and take public comment through Jan. 14.
Comments
Post a Comment