A few hours after "Liberation Day," the day Donald Trump announced tariffs on the rest of the world, including 20% for the Old Continent, the European Union (EU) is organizing its response. And it intends to "attack American digital services," French government spokesperson Sophie Primas stated on Thursday, April 3, on RTL. "With President Trump, we must enter into a balance of power," she insisted. While a first "response package" will be presented in mid-April, in retaliation for the taxes already announced on steel and aluminum, "a second response package" is currently being developed. It "will probably be ready by the end of April for all products and services, and I emphasize "services," with new tools," the spokesperson indicated.
On March 12, Benjamin Haddad had already mentioned this possibility. The Minister for Europe was interviewed on TF1 about the trade war with the United States. "We also have the means to go further with other types of services. (…) If it were to go further, (we could) include digital services or even intellectual property,” he indicated at the time.
The return of the Gafa tax?
On the European Union (EU) side, Ursula von der Leyen reiterated, in a statement published on the European Commission website, that Europe was “ready to react.” “A new package of countermeasures” is already in preparation, in the event that negotiations with Washington do not succeed, indicated the president of the European executive.
Will it be a tax targeting Netflix, Amazon Prime or Apple TV? A new tax on the turnover of American firms that sell electronic devices, software, or cloud services? A return of the Gafa tax, negotiations on which within the European Union have been suspended since 2021? "The mechanism today and the products that will be considered have not yet been decided. This is a discussion taking place between the member countries of the European Union," indicated Sophie Privas.
The use of the brand new "anti-coercion tool," never before used?
But "for digital services that are not currently taxed and which could be," "in Europe we have equipped ourselves with new tools called anti-coercion tools, and for example, this also includes access to our public procurement markets. So, today we have a whole range of tools and we are ready for this trade war," she said.
The government spokesperson is referring to a new tool put in place by a European regulation in 2023, which has so far never been implemented. It allows Brussels to "fight against unfair trade restrictions imposed by third countries" by deciding in particular "restrictions related to trade, investments and financing." Concretely, it allows the EU to adopt measures directly limiting trade in certain services within its territory, or limiting access to public procurement, specifies the European Parliament website. It remains to be seen what concrete measures will be put on the table.
On Wednesday, April 2, President Donald Trump announced that a minimum 10% customs duty would now apply to all products imported into the United States. The European Union, for its part, will be taxed at 20%, starting April 9. Chinese products, for their part, will be taxed at 34%.
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