The threat revives long-running U.S. opposition to France’s digital tax, which Washington says unfairly targets American companies.
U.S. President Donald Trump on June 15 threatened to impose a 100 percent tariff on French wines and champagne unless France eliminates its digital services tax on large American technology companies.
Trump said he delivered the warning directly to French President Emmanuel Macron, demanding that Paris scrap its 3 percent levy on major U.S. tech firms or face steep duties on some of France’s best-known exports.
“I asked him not to charge American companies, and if they do, I have no choice but to charge a 100% tariff on all champagnes and all wines coming out of France,” Trump told the New York Post in an interview. “All [Macron] has to do is get rid of the sales tax, and he wouldn’t have that kind of pressure.”
Trump’s threat prompted concern from French exporters, who warned of further strain on an industry that depends heavily on overseas markets.
“This new threat is bad news for our industry, which relies heavily on exports,” French wine and spirits exporters association FEVS said.
The group called for “responsible behavior” and urged France and the United States to maintain balanced and constructive trade relations “in the interest of both economies.”
France’s digital services tax, introduced in 2019, imposes a 3 percent levy on revenue generated in France by large digital companies. The tax applies to firms with more than about $29 million in French revenue and roughly $870 million in global revenue.
The measure has long drawn criticism from Washington, with the United States saying that it disproportionately targets American technology companies.
Experts say that even a relatively low digital services tax (DST) rate can lead to high effective tax burdens because revenues, rather than profits, are taxed.
“Because DSTs tax revenues, not profits, a company with a 10 percent profit margin would face a 60 percent effective tax rate on digital services provided in France,” economist Cristina Enache of the Tax Foundation Europe wrote in an October 2025 note.
Enache described the French tax as discriminatory and cited research noting that France’s DST is ill-conceived because, while it purports to target big digital platforms, the cost mostly falls on consumers.
“The French DST, which functions like a tariff on certain services, is designed to be discriminatory,” Enache wrote. “It targets industries largely dominated by US companies, and the discrimination would be even greater if the revenue threshold is increased.”
By Tom Ozimek
