Trump threatens 100% tariff on French wine and champagne over digital tax

Washington and Paris are facing renewed trade tensions as the US president targets France's levy on large technology firms ahead of the G7 summit. French wine and champagne exports once again face becoming collateral damage in a dispute between Washington and Paris, as Trump returns to a threat he has deployed repeatedly against France. According to a report on Monday by the New York Post, US President Donald Trump has threatened to impose a 100% tariff on French wine and champagne unless France abolishes its digital services tax on technology companies. France introduced the levy in 2019, applying a 3% tax on revenues generated within the country by major technology firms, including Facebook, Amazon, Apple and Google's parent company, Alphabet. French President Emmanuel Macron is due to host Trump on Monday ahead of the G7 summit in Evian, on the shores of Lake Geneva. Trump said he had urged Macron "not to charge American companies", according to the newspaper. "If they do, I have no choice but to charge a 100% tariff on all champagnes and all wines coming out of France," the Republican president was quoted as saying. "All Macron has to do is get rid of the sales tax, and he wouldn't have that kind of pressure." The United States is the largest export market for French wines and spirits, accounting for 21% of total exports last year, according to the French Federation of Wine and Spirits Exporters. French and European wines exported to the US already face a 15% tariff, up from 10% previously. Exports of French wines and spirits to the United States fell by 21% last year, according to the federation. In January, Trump threatened to impose 200% tariffs on French wine after France signalled it would decline an invitation to join his proposed "Board of Peace", aimed at resolving international conflicts. Canada dropped its digital services tax last year in an effort to preserve trade negotiations with the United States following pressure from Trump. Supporters of digital services taxes argue they help ensure large technology companies pay tax where they generate revenue and counter aggressive tax-optimisation strategies. During his first term, Trump also threatened tariffs on French champagne and cheese after France introduced its digital services tax in 2019.