Trump's tariff threat on digital tax targets Europe, but implications for UK unclear

US President Donald Trump has warned of punitive 100% import tariffs against any European country that introduces or expands digital services taxes targeting American technology companies. Writing on his Truth Social platform, Trump stated that the tariffs would be applied immediately and would override existing trade agreements between nations.

The threat follows Britain's existing 2% Digital Services Tax, which has been in place since 2020 and applies to major search engines, social media platforms, and online marketplaces with substantial revenues. The UK tax raised over £800 million in 2024–25 and affects companies including Apple, Google, Meta, and Amazon. Trump previously signalled that the UK faces "a big tariff" over the levy in April.

Several European nations already impose similar taxes: France, Italy, and Spain each levy 3% on large digital companies operating within their borders, whilst other EU member states have implemented or proposed equivalent measures. The threat comes just days after the US and EU finalised a new trade deal.

The US Supreme Court struck down Trump's attempt to impose a global 10% tariff in February, though the administration has since announced new tariffs of 10–12.5% on dozens of countries citing concerns over forced labour practices.