France has on Tuesday warned the US of a very strong EU retaliation should it imposed tariffs on key French products like sparkling wine to cheese and handbags, in an intensifying row over taxing digital giants that risks spiralling into a heavier trade war compare to China-US trade war.
French law makers at the beginning part of 2019 infuriated the administration of US President Donald Trump by passing a law taxing technology giants like Google, Apple, Facebook and Amazon for revenues earned inside the country.
All efforts to hold amicable settlement have failed so far and on Monday US threatened to impose tariffs of up to 100 percent on $2.4 billion in French goods like sparkling wine, yoghurt and Roquefort cheese.
“We were in contact yesterday with the European Union to ensure that if there are new American tariffs there will be a European response, a strong response,” The French Economy and Finance Minister Bruno Le Maire told Radio Classique.
“This is not the sort of behaviour one expects from the United States with respect to one of its main allies, France, and to Europe in general,” Le Maire said, also adding that he was looking at avoiding a pattern of ”sanctions and retaliation.”
France, who has the full support of Britain, says that the digital giants must pay taxes on revenues they generate in a country even if their physical headquarters is in a different country. Although, president Trump argues that American companies were targeted.
Sources: AFP, SurgeZirc UK