Dive Brief:
- The U.S. Trade Representative (USTR) is proposing tariffs on $2.4 billion in French goods at a rate of up to 100% in response to France's Digital Services Tax (DST), which the Trump administration says discriminates against U.S. companies, according to a Monday notice.
- The proposed tariffs would cover 63 tariff subheadings including varieties of cheese, makeup, handbags and porcelain. The DST is a 3% levy on services like targeted advertising and "digital interface services" when the revenue is generated in France.
- "They are American companies, I don't want France taxing American companies," President Donald Trump said of the tech companies likely affected by the DST Tuesday, according to The Wall Street Journal. French Finance Minister Bruno Le Maire said Tuesday the European Union was "ready to retaliate" if the U.S. put the tariffs in place.
Dive Insight:
The USTR named Google, Apple, Facebook and Amazon as companies that could be harmed by the new tax in France, according to the report issued by the agency Monday. In a statement, the USTR said it was considering similar investigations in Austria, Italy and Turkey.
The proposed tariffs are open for public comment until Jan. 6, 2020, and a public hearing is planned for the following day. The new proposal is the latest salvo amid months of tariff threats and implementations between the U.S. and the European Union.
In October, the U.S. announced it would levy tariffs on $7.5 billion worth of EU goods as a result of a World Trade Organization investigation into low-interest rates provided to Airbus. The tariffs covered aircraft and agricultural products. But the U.S. has also tossed around the idea of tariffs on vehicles coming out of the EU.
In what might be the most high profile trade war of a growing list, Trump suggested Tuesday the trade war with China might not see an end until after the presidential election. Trump told reporters in London he doesn't have a deadline for a deal, according to Markets Insider.
