France threatens concerted retaliation by EU over US threat of cheese tariff

FRANCE hit back at a US threat to slap 100 per cent tariffs on French cheese, Champagne and other products, as the president told Donald Trump the move would amount to an attack on all of Europe.

The US Trade Representative proposed the tariffs on $2.4 billion (£1.8bn) of goods in retaliation for a French tax on global tech giants including Google, Amazon and Facebook.

France’s reaction was swift, with President Emmanuel Macron and his finance minister warning of a European riposte if the American measures were to be implemented. “We’ll see where the discussions lead in the coming weeks, but it will involve a European response,” Mr Macron said in a meeting with the US president on the sidelines of a Nato summit.

“Because, in effect, it wouldn’t be France that is being sanctioned or attacked – but Europe.”

Mr Macron added it is “not fair” that digital revenues are taxed less than real-life revenues. He said

France should not be singled out for wanting to correct that imbalance with a tax on technology firms.

Mr Macron asked: “My first question is, what will happen with the

United Kingdom, which adopted the same tax? For Italy, the same tax? Austria, Spain...?

“If we’re serious, those countries will have to be treated the same way.”

The US move is likely to increase trade tensions between the US and Europe. Mr Trump said the European Union should “shape up, otherwise things are going to get very tough”.

“I’m not in love with those [tech] companies but they’re our companies,” he said ahead of his meeting with Mr Macron.

French finance minister Bruno Le Maire said the tariff threat from the US is “simply unacceptable. It’s not the behaviour we expect from the

United States toward one of its main allies”.

He said the French tech tax is aimed at “establishing tax justice”. France wants digital companies to pay their fair share of taxes in countries where they trade instead of using tax havens, and is pushing for an international agreement.

The problem is pronounced in Europe, where a foreign company can pay most of its taxes in the one EU country where it has its regional base – often a small country like Luxembourg or Ireland, which tries to attract multinationals with low corporate taxes.

Mr Le Maire noted that France will reimburse the tax if the US agrees to the international tax plan. He said France talked this week with the European Commission about Eu-wide retaliatory measures if Washington follows through with the tariffs next month.

EU Commission spokesman Daniel Rosario said the EU will seek “immediate discussions with the US on how to solve this issue amicably”.

The US tariffs could double the price American consumers pay for French imports and would come on top of a 25 per cent tax on French wine imposed last month in a separate dispute over subsidies to Airbus and Boeing.