Trump issues ultimatum to France over digital services tax

The U.S. market currently accounts for approximately one-fifth of global sales for the French wine industry, making the threat a significant economic lever. Trump’s stance directly contradicts recent claims from the Élysée Palace suggesting the dispute had been resolved ahead of the upcoming G7 summit in Évian-les-Bains. A U.S. official dismissed the French administration's characterization of the situation as inaccurate.

France’s tax, often referred to as the GAFAM levy, has been in effect since 2019 and targets local revenues generated by major tech firms including Google, Amazon, Meta, and Apple. Last year, the 3 percent tax brought in roughly $700 million. While France remains defiant, the diplomatic landscape is shifting; Canada recently abandoned its own digital tax under American pressure, and Italy is reportedly considering a similar retreat to avoid trade friction.