Channel

France, U.S. Declare Digital Tax Truce

France, U.S. Declare Digital Tax Truce

PARIS — Reuters, Bloomberg, and Seeking Alpha are reporting that French President Emmanuel Macron and U.S. President Donald Trump agreed to a truce in their dispute over digital taxes that will mean neither France nor the U.S. will impose punitive tariffs this year.

Macron said on Monday he had a “great discussion” with Trump on the issue, without giving details. “We will work together on a good agreement to avoid tariff escalation,” he said on Twitter.

“Excellent!” Trump said in a reply to Macron’s post, without providing additional information.

Macron and Trump agreed to hold off on a potential tariff war until the end of 2020. Negotiations at the Organization for Economic Cooperation and Development (OECD) will continue during that period as France postpones the levy and the U.S. delays retaliatory tariffs.

France decided in July to apply a 3% levy on revenue from digital services earned in France by companies with revenues of more than 25 million euros ($28 million) in France and 750 million euros worldwide (companies such as Google, Apple, Facebook, and Amazon).

Washington threatened to impose trade tariffs on French Champagne, handbags and other goods in response. It complained the tax unfairly targeted U.S. internet companies, a claim Paris dismissed.

France has offered to suspend until the end of the year down payments on its digital tax that would have been due in April.

“What we’re proposing is to give ourselves time and to show our goodwill, to postpone the remaining payments to December,” a French Finance Ministry source said.

Finance Minister Bruno Le Maire and U.S. Treasury Secretary Steven Mnuchin are due to negotiate the details in Davos, Switzerland, on Wednesday.

The White House said on Monday both Trump and Macron agreed it was important to complete the negotiations successfully.

 

Tagged with , , ,

Comment on the story

Your email address will not be published.