On Thursday, The U.S. denounced France for proposing measures to stop tax dodging by big tech firms, many of whom are U.S.-based. The move follows the Trump administration’s keenness for applying aggressive economic pressure, even against their own allies.
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The French parliament will vote friday on a bill that hopes to crack down on big tech companies that pay little or no tax to the countries they operate in. Firms such as Google and Amazon are notorious for paying very little, arguing that they should only owe the country where their headquarters are based.
The law would only charge 3% on revenue, but would raise over $400million for the French public purse.
However, the U.S. is angered that American companies could end up paying more. “The digital services tax that France and other European countries are pursuing is clearly protectionist and unfairly targets American companies in a way that will cost US jobs and harm American workers," says the Republican Senate Finance Committee
The U.S. may even impose retaliatory tariffs on France, of the kind meted out against China during the recent trade war.
The aggressive tone from the U.S. is in keeping with the Trump administration’s fondness for weaponizing sanctions and economic pressure. Trump has significantly tightened sanctions on Venezuela, Cuba and Iran, and has even targeted allies, such as when Trump told European countries that they will no longer be allowed an exemption from boycotting Iranian oil, threatening them with financial punishments if they continued to purchase.