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Trump: We'll Retaliate Against 'Macron's Foolishness'

President criticizes France's new digital tax on big companies, along with French wine
By Newser Editors and Wire Services
Posted Jul 26, 2019 2:06 PM CDT
President Trump speaks during a full honors welcoming ceremony for Secretary of Defense Mark Esper at the Pentagon, Thursday, July 25, 2019, in Washington.   (AP Photo/Alex Brandon)

(Newser) – President Trump on Friday promised to retaliate against France for adopting a pioneering tax on internet giants like Google, Amazon, and Facebook, per the AP. He also managed to get in a shot at French wine. Trump, who doesn't drink, tweeted: "I've always said American wine is better than French wine!" The digital tax primarily targets companies that use consumer data to sell online advertising. The tax is designed to stop multinationals from avoiding taxes by setting up headquarters in low-tax EU countries. Currently, the companies pay nearly no tax in countries where they have significant sales. Trump says that if anybody taxes American technology companies, it should be their home country. He adds, referring to French President Emmanuel Macron: "We will announce a substantial reciprocal action on Macron's foolishness shortly."

The French law does not specifically target US companies. It targets any digital company with yearly global sales worth more than 750 million euros ($844 million) and French revenue exceeding 25 million euros ($27.8 million). The revenue threshold is supposed to allow more room for smaller companies to enter the market. However, the Trump administration emphasizes that the services covered under the tax are ones in which US firms are global leaders. United States Trade Representative Robert Lighthizer initiated an investigation earlier this month to determine whether the tax is discriminatory or unreasonable and restricts US commerce. Such a finding would allow Trump to levy retaliatory tariffs. "The Trump Administration has consistently stated that it will not sit idly by and tolerate discrimination against US-based firms," said a White House spokesman.

(Read more President Trump stories.)

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