Trump Administration, Which Tried to Retaliate Against Digital Tax, Delays France's Tariff Imposition Plan

USTR "Digital Services Tax Investigation Still Underway"

[Image source=EPA Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] The Donald Trump administration in the United States has postponed its plan to impose retaliatory tariffs on French goods in response to France's digital tax targeting U.S. IT giants such as Facebook and Google.

According to Bloomberg News and others on the 7th (local time), the U.S. Trade Representative (USTR) issued a statement announcing that it has postponed the plan to impose tariffs on French goods that was set to begin the previous day. The USTR explained that it decided to postpone the tariff imposition on French goods considering ongoing investigations into similar Digital Services Taxes (DST) adopted or under review in 10 other regions.

In July 2019, France introduced a digital tax imposing a 3% levy on the annual revenue generated in France by primarily U.S. IT giants such as Google, Amazon, Facebook, and Apple. In response, the Trump administration announced last year that it would impose a 25% retaliatory tariff on $1.3 billion (approximately 1.5 trillion KRW) worth of French goods. The targeted products included representative French items such as cosmetics, handbags, and soap.

Bruno Le Maire, France's Minister of Finance, stated, "We are paying close attention to the decision of the U.S. administration," adding, "We believe such sanctions are illegal under World Trade Organization (WTO) rules," and emphasized, "Once again, we demand a comprehensive agreement on the trade dispute between the U.S. and Europe."

The U.S. decision is also expected to influence the foreign policy of the incoming Joe Biden administration, which takes office on the 20th of this month. Bloomberg reported, "Imposing tariffs on France or other European Union (EU) countries, which are among the United States' closest allies, would complicate President-elect Joe Biden's efforts to build relationships with these countries."

This content was produced with the assistance of AI translation services.