EU stands firm on digital tax, tells US President Donald Trump: ‘We have the …’

The European Union (EU) has pushed back against threats from US President Donald Trump, declaring that European nations hold a sovereign right to regulate and tax economic activity within their own borders.

The European Commission issued the statement following a series of warnings from the Trump administration, which has threatened aggressive economic retaliation against European countries that impose digital services taxes on American tech giants like Apple, Google and Meta.A spokesperson for the European Commission clarified that the tax frameworks are built to apply to corporate size and revenue, not nationality.

“Any taxes are non-discriminatory by design and apply equally to all large companies, regardless of their ‌origin,” news agency Reuters quoted ⁠a spokesperson as saying. European officials rejected accusations from Washington that the taxes unfairly target American companies.

The spokesperson added that the bloc would respond swiftly to ⁠unjustified unilateral measures, but remained open to a global ⁠solution in line with G7 agreements.

What is digital services tax

The digital services tax has been a point of friction between Washington and Brussels for some time now. European governments argue that Silicon Valley giants generate billions of dollars in revenue from European users but pay low corporate taxes by routing their profits through low-tax tax havens like Ireland.Trump vowed to impose a 100% import tariff on any European country that introduces a digital services tax on American technology giants. "Numerous European Countries have been discussing the imminent implementation of a Digital Services Tax on American Companies. Some of these Countries are close to actually doing this. Please let this statement serve to represent that any Country that imposes such a Tax will immediately be met with a 100% TARIFF on any and all Goods sent to the United States of America," Trump ⁠said in a social media post. Trump said the new tariff would supersede any trade deals with the US, “whether implemented, signed or not.

”While the EU expressed a strong desire to avoid a trade war, the bloc made it clear that it will not be bullied into dropping the policies.