President Trump threatened to scrap a just-finalized trade deal with the European Union on Friday, saying that any country that levies a digital services tax would be hit immediately with a 100 percent tariff on all exports to the United States.
Mr. Trump seized on the fact that several European countries are discussing imposing such taxes. Those taxes would apply to the revenue that major U.S. tech firms earn in Europe. If they choose to proceed, the United States would “immediately” impose a 100 percent tariff on them, he said.
“This TARIFF will supersede Trade Deals made with the Country, whether implemented, signed, or not,” he wrote.
Earlier in June, Mr. Trump threatened to put a 100 percent tariff on French wines over the nation’s digital taxes, but has not done so.
It’s unclear how quickly the president could impose any such levies. The Supreme Court in February struck down tariffs Mr. Trump had issued last year using an emergency law that allowed him to impose levies on any country by issuing an executive order.
Other legal options that would allow the president to issue tariffs typically take more time to impose. But the United States has investigated digital service taxes in France, Austria, Spain and Italy in the past using a legal provision known as Section 301, which could allow the administration to issue tariffs on a shorter timeline.
The president’s posts threatened to undermine the terms of a trade deal that has taken months to conclude.
The European Union just this week finalized a sweeping trade accord it struck with the United States last year at President Trump’s golf course in Turnberry, Scotland.
Widely referred to as the “Turnberry deal,” the agreement had been delayed repeatedly. Negotiations ground to a standstill earlier this year when Mr. Trump threatened to take over Greenland, a semiautonomous territory of Denmark, for instance.
Europeans have widely viewed that trade deal as a bad one, from their side — it locks in higher levies on many European products, while cutting them to zero on industrial goods coming from America.
But European officials had pushed ahead with the deal in order to secure certainty for their businesses. Under the agreement, many European Union goods sent to the United States are tariffed at around 15 percent.
The Trump administration has aggressively opposed foreign taxes on digital services, which are levied by governments on the revenues of technology firms like Facebook and Google. France, Italy, Spain and Austria have introduced domestic digital service taxes, among other countries, and the bloc has in the past considered an E.U.-wide digital tax. Other nations, like Belgium, have been considering one.
In Europe, policymakers have long been frustrated that they collect little tax revenue from tech companies that have become ubiquitous. The companies are typically taxed on profit, which has historically been steered to low-tax hubs like Ireland or Luxembourg.
Last week, the Trump administration also initiated a trade investigation into whether Germany is underpaying for pharmaceutical products. The administration is set to hold hearings on the action in September, but then could choose to impose tariffs.
The 27 nations of the European Union negotiate trade as a bloc, so policies targeting one nation or a few member nations are generally responded to by the entire union.
Kush Desai, a White House spokesman, said that the president had “made his opposition to digital services taxes and other forms of extortion against American tech firms unequivocally clear, and is committed to using the many legal authorities at his disposal to defend American workers and businesses.”
The European Commission, the executive arm of the European Union and the lead body on trade issues, did not immediately respond to a request for comment.
Adam Satariano contributed reporting.
