July 11 (UPI) — The Trump administration has announced a 25 percent tariff on $1.3 billion of French goods, including handbags, cosmetics and soaps.
The tariffs, detailed in a Federal Register notice published Friday, are a reaction to France’s digital service tax on U.S. Internet companies, which U.S. officials have argued unfairly targets companies like Facebook, Google and Amazon.
France has implemented a 3 percent tax on revenues some companies earn from providing goods and services to French users online, regardless of where the companies are physically based.
The tariffs — which exclude wine, cheese and cookware, goods the U.S. had previously threatened to tax — won’t take effect until January 2021, in an attempt to give the two countries time to resolve their dispute over the digital tax.
The decision was applauded by a major industry group, along with U.S. lawmakers on both sides of the aisle.
“Retaliatory tariffs aren’t ideal but the French government’s refusal to back down from its unilateral imposition of unfair and punitive taxes on U.S. companies leaves our government with no choice,” Senate finance committee Chairman Chuck Grassley, R-Iowa, and ranking member Sen. Ron Wyden, D-Ore., said in a statement.
“Today’s action sends a strong message that discriminatory taxes aimed at U.S. companies are not a path to modernizing the global tax system,” Matt Schruers, president of the Computer and Communications Industry Association, said in a statement obtained by Politico. “Changes to international tax rules must be negotiated in good faith through a consensus-based approach at the OECD that addresses the changes of the digitalized global economy.”